June ’26: Is zero tax worth the hassle?

Monaco

I was lucky enough to go to Monaco for the F1 in June.

Something I feel quite strongly about and have written about before on this blog is how strong the monkey brain wiring is for us all to peg ourselves off the next rung up on the ladder. No matter how high up on the ladder we are ourselves, we instinctively compare ourselves to people who are ‘above’ us – i.e. “I’m not that rich, because I am not as rich as [X]”. I’ve argued before that we all know somebody doing 2x as well as us.

Monaco’s F1 was one of those ‘look at what’s above you on the ladder’ moments. And there are a lot of people who give the appearance of being a few rungs up on the ladder.

I couldn’t help but do a bit of quick research on the practicalities and advantages of moving to Monaco (the ‘sunny place for shady people’). My net worth is such there would be some clear advantages. My immediate conclusions were as follows:

The tax arrangements look pretty attractive! There are no direct personal taxes – no income tax, no capital gains tax, no wealth tax, no annual property taxes. There are inheritance taxes but only on physical assets located within Monaco. There are transaction taxes on real estate, but they are not high by international standards (e.g. a rental lease incurs a tax of 1% of its value). VAT is a normal-for-Europe 20%.
Becoming a Monaco resident is do-able, admittedly not trivially. The UK is the largest source of foreigners moving to Monaco, after France. You need to get a long term France visa, and then you need to persuade a Monaco private bank to take you on – this sounds like it is the effective bottleneck. According to an AI bot, those banks will want at least €1m and maybe €3m deposited with them. You also need to find a place to live in Monaco – the usual route is by renting, which isn’t cheap, though sensible places are available for ~€100k per year. In effect, this is your ‘nom dom charge’.
But doing a ‘clean break’ with the UK would be difficult. I think I would end up with at least ‘2 Ties’ to the UK, meaning I would be able to spend only 90 days in the UK without remaining classed by the HMRC as a UK resident. That doesn’t appeal very much. But, who knows, something to think more about if the imminent Labour government does anything crazy (and doesn’t impose stiff exit taxes).

Based on the above, moving to Monaco only really makes sense for UK folks who are retired (i.e. have no more office/etc commitments), prepared to leave the UK for three quarters of the year, and have otherwise-taxable income of around £250k p.a. or more. Evidently the average net worth of residents is around $20m., and the median resident is a millionaire. I can see why F1 drivers make the move but, even if I had no more face-to-face meeting requirements, it doesn’t make as much sense for me.

Markets in June

I don’t have too much to say about market movements in June. US markets fell a bit, for reasons I don’t remember at the time of writing – though perhaps Trump’s Iranian delusions being revealed was a factor – though the USD rose. Other markets rose gently. The AUD fell. On a weighted average basis, my benchmark – adjusted for currency movement – was almost completely flat, which is a rarity.

My portfolio in June

My portfolio lost about 0.4% of its value in June, a little bit worse than the market average.

My dividend income was pretty tasty however -my highest June dividend stream for 10 years. Year to date, my dividend stream is in fact a tiny bit down on 2025’s H1, though I am still awaiting on a couple of quarterly reports to come in at which point I think 2026 will overtake 2025.

My leverage remains a little bit elevated, after my property buying antics a few weeks ago, but you can barely see it on asset allocation deltas. More obvious is a US / Asian overweight, and a UK underweight – but all broadly within my tolerance levels.