<aside> 🚩 If you enjoy our work, please share our newsletter with other people who also might benefit from it. To work with us personally on your passport and tax planning, book a demo here.

</aside>

Sometimes an easier way to think about becoming an Anticitizen is by considering the concept of “Flag Theory.”

Flag Theory is a strategy for gaining more personal and financial freedom by spreading your assets, citizenships, and residencies across several countries. Initially described in the 1960s by investment advisor Harry D. Schultz, it uses the benefits of different countries to boost your freedom, privacy, and wealth protection.

Core Principles of Flag Theory

1. Second Passport: Citizenship in another country is a cornerstone of Flag Theory that we’ve already discussed. This provides a safety net, enhanced travel freedom, and potential tax advantages. For example, a second passport from a country like Grenada, which is one of the only passports on Earth that provides visa-free access to China, Russia and the EU, can significantly enhance global mobility, or fill in free-travel gaps your other passports don’t provide.
2. Residency: Establishing a residency in a low-tax jurisdiction can greatly reduce overall tax liabilities. Countries like Portugal, Croatia, and Malta offer favourable tax regimes for new residents, independent entrepreneurs, or digital nomads, providing substantial savings or tax-free breaks for multiple years, through programs such as Portugal’s Non-Habitual Resident (NHR) regime, or Croatia’s digital nomad visa.
3. Business Base: Setting up a business in a country with a business-friendly environment can minimise state burdens and taxes. Singapore, Estonia, and Hong Kong are popular due to their low corporate taxes, efficient governments, and supportive business environments.
4. Asset Protection: Holding assets in countries with strong property rights and strong privacy laws is crucial for protecting wealth from possible political or economic instability in your home country. Switzerland, which while not as private as before, is still somewhat known for its banking secrecy laws. But it’s far from being the only place in the world that’s a good fit for asset protection.
5. Playgrounds: Spending significant time in countries with high living standards and favourable conditions for personal well-being is another aspect of Flag Theory. This might include countries with excellent healthcare, low crime rates, rich cultural, great beaches, activities you love, an incredible food scene, or anything else you want to experience in daily life.

Practical Applications

To apply Flag Theory in your life, you need to plan carefully and follow the legal rules of each country. For example, you could set up your business in Hong Kong, or an LLP in the UK the low taxes and benefits of an easy business environment. You keep your investments in Swiss bank accounts for their world-class privacy laws, establish residency in Croatia or Georgia as a nomad, or or Portugal as a more permanent resident, to enjoy tax benefits. And finally, get a second passport from Dominica for greater travel freedom.

Each "flag" you plant in a different country helps you spread your risks and take advantage of the best benefits each place offers.

The best part about Flag Theory as an Anticitizen, is that there is no one “best” or “perfect” solution. You can get to build you life around where you personally want to live, travel, pay tax, do business, set up a company, and more.

And the good news is, options on how you can do this are only increasing each year, as more and more companies open up schemes to offer residencies, citizenships, or tax breaks to people who want to live this kind of life.

But when should you take action to begin planting flags around the world? We’ll cover that in the next lesson.