Flag Theory is a tactical framework, a process for Perpetual Travellers achieved by planting flags in different countries. Each flag represents a specific element of life: personal, financial, or business. Anyone wishing to pursue an international perspective can properly utilize the flag theory to increase his or her freedom, privacy, and wealth.
The passport you carry should be from a neutral, well-respected country with numerous visa-free travel options, one that does not tax its non-resident citizens and allows multiple citizenships. Examples include Canada, most European and Caribbean countries.
Your official country of residence is the address you give when you check into a hotel, though not necessarily where you spend your time. Normally, you will have an official document, such as a residence permit, from this country. Your country of residence should be one that does not tax its residents on income generated outside its borders. Examples include Monaco, Andorra, Belize, Malaysia, and most of Latin America.
Is one or more stable financial centres where you keep and manage your money, using trusted asset managers and possibly making use of trusts, foundations, etc. Examples include Switzerland, Singapore, and Panama.
Is one or more countries where you earn your income. Everything you do here is tied up in companies that file their own accounts and pay when necessary. These companies are owned from the asset haven so they don’t trigger requirements to file a personal tax return. These companies can be located anywhere in the world. The PT ideally sells goods and services over the Internet, allowing the business base to be a simple offshore company.
These are countries where you spend your time physically, depending entirely on your personal likes and dislikes. Hot beaches, nightlife, or cool mountains…you choose. If you get bored, you move on. In these countries you are merely a tourist passing through. You are welcomed because you spend money and nobody even thinks of trying to tax you.
This is your extra- jurisdictional flag that brings the other five together. You can be everywhere and nowhere at the same time. One or more secure data havens or communication centres are essential to today’s PT lifestyle.