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Five Low-Tax Countries for Expats in 2024

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What exactly is an expat? It’s not as straightforward as you might think.

Ask a handful of expats to define the term and you’ll get a handful of different answers. When it comes to discussing the perks of global taxes and living abroad, the waters get even murkier.

Everyone has their own take.

Here at Nomad Capitalist, we see an expat as someone who’s not just living outside their home country, but someone who’s chosen to make a new country their home, whether that’s a temporary thing or for the long haul. These expats aren’t bouncing around; they’re putting down roots, for a while at least.

However, there is more than one way to live the Nomad Capitalist lifestyle. 

For example, when you might see young digital nomads bopping around the world, going to various countries with a suitcase in tow, you might think to yourself, ‘That’s not stable enough for me’. Or, you might see an older person living in a single tax-friendly country as an expat and think, ‘That’s a bit too settled for me.’ 

Depending on your perspective and lifestyle choices, there’s no perfect way to do it. However, what links, or what should link, all versions of expat living is the desire to go where you’re treated best. 

Those five magic words encapsulate what we believe any successful entrepreneur or investor should aspire to – the ability to legally reduce their income tax rates and bills, diversify and protect their assets and maximise their freedom.

The Origins of Go Where You're Treated Best

More and more people, especially Americans, Canadians and Australians, who are tired of the anti-freedom and high-tax policies their governments have thrust on them in recent years, are voting with their feet and moving overseas.

There are many options and countries where that dream can happen – with proper planning – so we’ve put together some recommendations for tax-friendly, lifestyle-enhancing overseas living. Whether you’re going to invest, start or bring a business or retire, you need to choose the best country which will allow you to do this with confidence. 

Low-Tax Countries for Expats

Some countries actively court foreign expats by offering benefits beyond the built-in perks, such as low-cost living, warm weather, friendly locals and beautiful surroundings. 

So, here are our top choices. 

1. Costa Rica

Healthcare Costs in Costa Rica

Costa Rica’s relaxed lifestyle, stable political climate and large expat community are obvious benefits, but the option to pay zero or low taxes is definitely the clincher. No matter where you’re from, this Spanish-speaking, well-situated and safe country is definitely worth considering. 

Costa Rica’s proximity to North America and its status as a US overseas territory offer added impetus to US citizens who can avail of tax incentives there. Costa Rica’s territorial tax system means it taxes residents on income earned within the country, while foreign-sourced income is tax-free. For companies based there, offshore transactions are not considered local income and are not subject to tax. 

Of course, you will need to establish residence in the country and be considered a tax resident by spending over 183 days there in the same tax year. 

To begin the process by first getting temporary residence, you will need to demonstrate the following:

  • A monthly income of at least US$2500 per month for at least two years
  • A US$60,000 deposit in an approved Costa Rican bank that covers your entire family 
  • Invest in a business or property in Costa Rica for US$200,000 or more
  • A pension or retirement income of at least US$1000 a month under the Pensionado program. 

You qualify for permanency after three consecutive years of being a temporary resident.  

Citizenship can be obtained by a foreign national after seven years of legally living in Costa Rica. Having a second residency in Costa Rica won’t cost the earth and offers a variety of benefits, including the opportunity to lower your tax obligations. 

2. Ecuador

Retire in Ecuador

Though Ecuador is, in principle, a high-tax country, it’s possible to structure a business there and benefit from an inexpensive residence, low taxes and an attractive lifestyle.

Ecuador’s tax system is neither fully territorial nor worldwide, but a combination of both can be navigated to achieve low taxes. If you’re not taxed elsewhere, Ecuador will tax you but if you have overseas income that is taxed at a rate of at least 14%, it will not be taxed in Ecuador. So, you won’t pay anything by using a tax credit in Ecuador. 

Any income you generate there is taxed at standard rates: personal tax of up to 35%, corporate tax of 25% and 10% on capital gains. However, if the income received in an offshore company is structured in your own name, the first US $12,000 of the salary is tax-exempt. You can also remit money into the country under progressive tax rates, which are low in comparison to other places. 

There are five ways to get Ecuadorian residence:

  • Deposit not less than US$45,000, plus US$500 for each dependant in Central Bank
  • Invest US$45,000 in a house, apartment, office, or real estate 
  • Invest US$25,000 in an Ecuadorian company or US$45,000 in your own venture 
  • Have retirement income for the remainder of your life of no less than US$1,350 a month
  • Have a monthly legal income of US$1,350 through dividends, interests or rents.  

With its low cost of living, Ecuador is a top destination for foreign retirees and anyone looking for a low-cost, hassle-free backup residence in Latin America. 

3. Greece

Retire in Greece

From its Mediterranean climate to its incredible food and low-cost living, it’s hard not to get excited about the lifestyle Greece has to offer.

You can qualify for its flat-tax regime after six months of living in Greece as an expat and getting tax residence. Ideally suited to those who make over six figures in foreign-sourced income a year, the maximum you pay is €100,000 a year under a special arrangement. Regular taxes ranging from 22% to 44% apply to income sourced over €40,000. 

Of course, you must earn enough to justify the €100,000 flat-tax payment and you must also invest at least €500,000 in an apartment, house, or business in Greece. If you’ve already paid for a Greek Golden Visa, you qualify for the flat tax.  

Greece’s Golden Visa scheme involves an investment of between €250,000 and €800,000 in real estate, depending on the region where the property is located, or €400,000 in shares or funds based there.

Another option for those who can’t invest in a Golden Visa is to demonstrate a minimum monthly income of €2000. 

Those who retire to Greece from countries with a double taxation treaty with the country are eligible for a flat tax rate of 7% for ten years. You’re covered if you’re from the US, the United Kingdom, and most European countries. However, if you’re a US citizen, then unless you renounce your citizenship, you will remain a tax resident in the US, and the flat-tax process will involve more work.

Greece’s flat-tax regime offers significant advantages for expats who want to live there for part of the year and those who want to keep more of their hard-earned pension.  

4. Malta 

Moving to Malta to Reduce Your Taxes

Malta offers sunshine, low taxes, and a laidback Mediterranean lifestyle, all within a stone’s throw of mainland Europe. The island nation is praised by expats the world over for its high standard of living, advanced healthcare and excellent education system.

Malta also offers personal tax breaks and exclusions for specific types of income for those who become residents. 

You can qualify for the Malta Permanent Residency Program (MPRP) through investments in property and government contributions to the right to live in Malta permanently. Maltese residence also offers unrestricted travel within the Schengen Area, which accounts for most mainland European nations.  

The requirements include having capital assets of at least €500,000 and a minimum of €150,000 in financial assets. You must also buy or rent a property, make a government contribution and donate to a local charity or a registered charity.

The amounts required are as follows:

  • A property purchase of at least €350,000 or €350,000 if in the South of Malta 
  • Rent a property with a minimum annual rent of €12,000 or €10,000 in the south of Malta
  • A government contribution of €28,000 if buying or €58,000 if renting a property
  • At least €2000 to a local charity. 

Once you have residence through the MPRP, you’re taxed on a source-and-remittance basis only. The MPRP scheme is for residence, not tax residence, so you must live in Malta for 183 days and qualify for non-dom status – you can learn more about that here

This means only capital gains arising in Malta or foreign income remitted to Malta is taxed. For foreign-source income over €35,000 arising outside Malta that’s brought in, a minimum tax liability of €5,000 or €15,000 for a family is payable.

5. Malaysia

Eastern Europe Cheapest Places Southeast Asia Malaysia

Malaysia is a country that offers advantages to expats in terms of taxes, property, lifestyle and second residency. If you can show wealth, various options are available to foreigners who want to move there. In fact, you will be welcomed with open arms.

In Malaysia, expats pay no taxes on foreign-earned income or assets and only pay taxes on what they bring in on a remittance basis. Under recent changes, chargeable income brought from abroad is taxed at progressive tax rates.

The government’s initiatives to entice expats include the Sarawak My Second Home (S-MM2H) and MM2H programs. If you successfully apply for either of these, a five or ten-year renewable visa to live in Malaysia awaits

To qualify for the five-year residency MM2H, you must:

  • Be at least 30 years old
  • Make a fixed-term deposit of 500,000 Malaysian ringgit (RM), equivalent to around US$106,000
  • Purchase a property for a minimum of RM750,000
  • And have a monthly income equivalent to RM40,000. 

After a year there, it’s possible to withdraw half of your funds to buy a home or car or pay medical education expenses in Malaysia. 

Another option is the Premium Visa Program, which offers residence for 20 years without physical presence or age restrictions in return for RM1 million (US$209,000) held in a local bank. There’s also a requirement to have foreign income of at least RM40,000 (US$8,370) a month or RM480,000 (US$100,450) per year. 

Not only is Malaysia a perfect Plan B residence option, but it’s also a leading choice if you want to spend quality time in a fast-emerging, tax-friendly country that welcomes expats. 

Five Low-Tax Countries for Expats: FAQs

What are tax-free countries?

Countries with no taxes have a simple system where individuals do not pay any income tax. Each tax-free country has its own rules and regulations but often doesn’t impose a personal income tax, capital gains tax, or corporate tax. It is usually known as a tax haven, such as the Cayman Islands. On the other hand, low-tax countries use territorial systems that only tax local sources of income. Check out our article on countries with no income tax to learn more. 

Where is the best place to live in the world with no taxes?

What is ‘best’ depends on each individual’s personal circumstances. One of the world’s most well-known and high-level tax-free countries is Monaco, a well-known tax haven situated on the French Riviera. The country does not impose personal income taxes or capital gains tax. 
Some Caribbean islands are popular and well-known locations for those searching for zero corporate income tax and a zero income tax rate, where they can reduce their tax burden and keep more of their hard-earned cash. 

Which country in Europe has the lowest taxes?

Bulgaria has the lowest flat personal and corporate tax rate in the European Union at 10%. Other countries with The Lowest Taxes in Europe include Georgia, the Czech Republic and Montenegro. 

Which country is most tax-friendly for retirees?

Two regions stand out as potential options for tax-friendly retirement: Eastern Europe and South America. Check out our list of the best countries to retire in the world, which includes Latin American nations, Costa Rica, Ecuador and Panama. 

Which Caribbean country has no tax?

Some Caribbean countries, with no income taxes, offer citizenship by investment. Antigua and Barbuda and St Kitts and Nevis have no taxes, and in Grenada, Dominica and St Lucia, foreigners pay taxes only on income earned in the country.

What’s the country with the highest tax rate in the world?

The Ivory Coast tops the list of the countries with the highest tax rates, at a whopping 60%. According to a survey, the top five countries with the highest personal income tax rates are Finland (56.95%), Japan (55.97%), Denmark (55.90%) and Austria (55%).

Financial Freedom

Go Where You Are Treated Best

The Nomad Capitalist lifestyle is all about ‘going where you’re treated best’ and planting flags in different countries that serve you better than any other. 

However, you’ll need to plan this carefully and that’s where Nomad Capitalist comes in. 

We help seven- and eight-figure entrepreneurs and investors create a bespoke strategy using our uniquely successful methods, enabling you to benefit from low corporate tax and personal income tax rates and, in some cases, even zero-tax systems.

In just three steps, that will allow you to keep more of your own money, create new wealth faster and be protected from whatever happens. 

At Nomad Capitalist, we have a network of lawyers, estate agents, accountants, and tax and company formation specialists all around the world. All that expertise and real-world experience come together when we devise your holistic, bespoke action plan. Discover how we do things here.

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