NYEXPAT
Thinks s/he gets paid by the post
I have had a few inquiries from friends who wish to invest in a 3 year Peruvian CD currently paying 9% interest (local currency). The problem is as foreigners on tourist visa's they can no longer open a bank account here. I am trying to develop a legal mechanism to overcome the problem and wonder if somebody could check my math?
I wire transfer $145,000 to a Peruvian bank :
1. The US bank withholds 30% (43,500) for 1 year until I file my US tax return (0% interest and 3.5% inflation).
2. Both banks charge $50 each for a round trip wire transfer. ($200.00)
3. Peru charges a .0015 financial tax on all bank transactions (of which there will be 2 in total $300.00)
4. Interest income is non taxable in Peru
5. For sake of argument no currency exchange fees apply as appreciation of the local currency should offset any exchange fee's.
6. $3000.00 management fee (1%) deducted from outset.
145,000.00 original WT
- 43,500.00 30% withholding
-3,000.00 management fee
- 300.00 ITF
- 200.00 Wire transfers
$98,000 invested in CD at 9% for 3 years = $28,912.00
$126,912.00 returned at end of 3 years
$25,412.00/101,500.00 (original wire transfer amount)= 8% return per year for 3 years
Have I calculated this right or should I also calculate the loss of use of the $43,500 for one year?
I wire transfer $145,000 to a Peruvian bank :
1. The US bank withholds 30% (43,500) for 1 year until I file my US tax return (0% interest and 3.5% inflation).
2. Both banks charge $50 each for a round trip wire transfer. ($200.00)
3. Peru charges a .0015 financial tax on all bank transactions (of which there will be 2 in total $300.00)
4. Interest income is non taxable in Peru
5. For sake of argument no currency exchange fees apply as appreciation of the local currency should offset any exchange fee's.
6. $3000.00 management fee (1%) deducted from outset.
145,000.00 original WT
- 43,500.00 30% withholding
-3,000.00 management fee
- 300.00 ITF
- 200.00 Wire transfers
$98,000 invested in CD at 9% for 3 years = $28,912.00
$126,912.00 returned at end of 3 years
$25,412.00/101,500.00 (original wire transfer amount)= 8% return per year for 3 years
Have I calculated this right or should I also calculate the loss of use of the $43,500 for one year?