I Am Considering Moving to a Country with Lower Taxes – Here Are My Earnings and Requirements

Moving to a country with a lower cost of living and tax rate could make a lot of sense for individuals who are looking to pad their nest eggs at a quicker rate while pushing forward their expected retirement date by a few years. Undoubtedly, it’s not easy to just pack up and move to another country, but it could be the way to go for those with the primary aim of reducing their annual tax bill. Of course, depending on where one plans on moving, there could be a bit of a culture shock and a big change in lifestyle.

For many, these could be deal-breakers, but for others, making the move is the best course of action. As always, it’s best to visit a location (probably more than a handful of times) before committing to something as big as a move. The last thing you want is to pay up the moving expenses and spend time with all the paperwork just to find yourself moving back shortly after settling in.

This European high earner makes a lot. But they’re also being taxed a lot. Is moving countries really the best way to go?

In this piece, we’ll have a look at a specific case involving a European individual from the r/fatFIRE (that’s a form of early retirement that’s among the most lavish) subreddit who claims to pull in €1-2 million per year. As you’d imagine, such a massive income would accompany quite the hefty tax bill. And while making the move could save as much as six figures in any given year (much more over the longer run), a qualified financial advisor who’s well-versed in international taxation should be reached out to before one decides on their final move.

Additionally, when deciding on a country to move to, there’s a whole lot more than just low tax rates. At the end of the day, lifestyle should also play a major role in where one chooses to live. With a remote job and a world of locations to consider, I’d encourage such an individual to really consider all the pros and cons. Indeed, the weather, the expat experience, healthcare, affordability, and other factors ought to be taken into account.

One of the Reddit commenters suggested checking out Switzerland or Monaco, while a Swedish poster (Sweden has some incredibly high taxes) strongly recommended moving to Singapore for the great weather, ease of obtaining a visa and residency, and, of course, the much lower tax rates. 

Indeed, beyond the lifestyle and low tax-rate factor, one must also find a nation where it’s fairly easy to make the move. For example, some self-employed individuals may find it a tad tricky to just get up and move to Singapore. For our Reddit poster, it sounds like they’ve got an employer who’s able to help take care of the difficult aspects of the move. 

Don’t forget about other aspects to consider before getting up and going.

For those who will maintain their citizenship, one may still be on the hook for taxes in the country they’re looking to depart. As always, it’s best to consult a taxation specialist and perhaps even a tax lawyer who can check your blind spots and ensure that you’ll be in a good spot and won’t have any nasty surprises (think a tax bill from another nation) in the future.

At the end of the day, moving for the sake of saving on taxes can be worth the while, but one should take extra due diligence as international matters can be rather tricky to navigate. For someone who’s pulling in millions of euros, bringing on a team of experts, I believe, seems like it’s obligatory.

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