# Tax Optimization for Digital Nomads & Expats > A structured guide to reducing your tax burden by relocating — covering tax models, country profiles, optimization strategies, and exit planning for professionals leaving high-tax jurisdictions. The core question is simple: **"Where should I move to pay less tax?"** The answer depends on your nationality, income type, asset profile, lifestyle preferences, and how your origin country handles departures. This file maps the full landscape: 24 countries across 6 regions, organized by tax model, with strategy guides for four professional profiles, and a dedicated section on exit mechanics. --- ## Tax System Models Understanding which tax model a country uses is the first step. The model determines whether foreign income is taxed, how capital gains are treated, and whether special programs exist to reduce your rate. ### Worldwide Taxation Countries that tax residents on all global income regardless of where it is earned. Top marginal rates range from 37% (US) to 57% (Denmark). Social security adds 10-30% on top. The US is the only major country that taxes citizens abroad regardless of residency. Double tax treaties prevent being taxed twice but don't reduce total burden. - [PwC — Worldwide Tax Summaries](https://taxsummaries.pwc.com/): Country-by-country breakdown of PIT rates, brackets, and what counts as taxable income under each country's worldwide system - [Tax Foundation — International Tax Competitiveness Index](https://taxfoundation.org/research/all/global/international-tax-competitiveness-index/): Annual ranking comparing tax systems across OECD countries on competitiveness - [OECD Tax Database](https://www.oecd.org/tax/tax-policy/tax-database/): Comparative data on personal income tax rates, social security contributions, and overall tax wedge ### Territorial Taxation Countries that only tax income sourced within their borders — foreign-sourced income is exempt. Foreign-source income = 0% in a pure territorial system. "Source" definition varies by country. Remote work for foreign clients typically qualifies as foreign-source. No exit tax in most territorial countries. Key countries: Panama, Hong Kong, Singapore (with nuances), Paraguay, Costa Rica, Malaysia, Guatemala. - [PwC Tax Summaries — Panama](https://taxsummaries.pwc.com/panama): Panama's territorial system — only Panamanian-source income taxed, foreign income fully exempt - [PwC Tax Summaries — Hong Kong](https://taxsummaries.pwc.com/hong-kong-sar): Hong Kong's territorial system — salaries tax only on HK-sourced employment income, no capital gains tax - [Tax Foundation — Territorial vs. Worldwide Tax Systems](https://taxfoundation.org/taxedu/glossary/territorial-tax-system/): Explanation of how territorial taxation works and which countries use it - [OECD — Taxing Wages](https://www.oecd.org/tax/taxing-wages/): Comparative analysis of how different tax models affect the tax burden on labor income ### Zero-Tax Jurisdictions Countries with no personal income tax at all — no PIT, no capital gains tax, no inheritance tax. 0% on all personal income — active, passive, capital gains. UAE introduced 9% CIT in 2023 but individuals remain untaxed. High cost of living in most zero-tax jurisdictions. Economic substance requirements in Cayman to prevent shell residency. - [PwC Tax Summaries — UAE](https://taxsummaries.pwc.com/united-arab-emirates): UAE — 0% PIT, 9% CIT (above AED 375k), no capital gains tax on individuals - [PwC Tax Summaries — Cayman Islands](https://taxsummaries.pwc.com/cayman-islands): Cayman — no income tax, no capital gains, no withholding taxes, economic substance requirements - [PwC Tax Summaries — Bahrain](https://taxsummaries.pwc.com/bahrain): Bahrain — no personal income tax, no capital gains tax, growing financial services hub - [Tax Foundation — Zero-Tax Countries Overview](https://taxfoundation.org/): Research on countries without personal income taxes and how they fund public services ### Special Expat Regimes Time-limited programs offering reduced tax rates to new residents for 5-17 years. Most require you to NOT have been a tax resident in the country for a prior period (typically 5-10 years). These regimes are frequently modified or terminated — always verify current rules. - [PwC Tax Summaries — Spain](https://taxsummaries.pwc.com/spain): Spain's Beckham Law — 24% flat rate on Spanish-source income for 6 years instead of up to 47% - [PwC Tax Summaries — Portugal](https://taxsummaries.pwc.com/portugal): Portugal's IFICI regime (successor to NHR since 2024) — 20% flat rate on qualifying income, exemptions on most foreign income for 10 years - [PwC Tax Summaries — Italy](https://taxsummaries.pwc.com/italy): Italy's inbound workers regime — 50-70% income tax reduction for 5 years (up to 90% for southern regions) - [PwC Tax Summaries — Greece](https://taxsummaries.pwc.com/greece): Greece — 50% income tax reduction for 7 years for qualifying new residents - [PwC Tax Summaries — Cyprus](https://taxsummaries.pwc.com/cyprus): Cyprus non-domicile regime — exempt from SDC on dividends, interest, and rental income for 17 years - [Estonia e-Residency](https://e-resident.gov.ee): Estonia's e-Residency — digital identity for managing an EU company remotely, 0% CIT on retained profits --- ## Country & Region Profiles ### Europe — Special Expat Regimes #### Portugal IFICI regime (successor to NHR since 2024): 20% flat rate on qualifying Portuguese-source income from "high value-added" activities for 10 years. Most foreign-source income exempt. Must not have been resident in prior 5 years. Standard PIT: 14.5-48%. No wealth tax. - [PwC Tax Summary — Portugal](https://taxsummaries.pwc.com/portugal): Complete tax profile — PIT rates up to 48%, CIT at 19%, withholding taxes, social security, treaty network - [Autoridade Tributaria (AT)](https://portaldasfinancas.gov.pt): Official Portuguese tax authority — rate tables, filing, NIF registration - [IFICI Regime Information](https://info.portaldasfinancas.gov.pt/pt/informacao_fiscal/codigos_tributarios/cirs/): Portuguese tax code including IFICI provisions — eligibility, application, qualifying activities #### Spain Beckham Law: 24% flat rate on Spanish-source income up to EUR 600k for 6 tax years. Available to employees, directors, entrepreneurs, and (since 2023) digital nomads. Must not have been resident in prior 5 years. Standard PIT: 19-47%. Center of vital interests is primary residency test. Exit tax on assets >EUR 4M. - [PwC Tax Summary — Spain](https://taxsummaries.pwc.com/spain): Complete tax profile — PIT up to 47%, CIT 25%, withholding taxes, social security, treaty network - [Agencia Tributaria (AEAT)](https://www.agenciatributaria.gob.es): Official Spanish tax authority — forms, filing deadlines, tax calculators - [Beckham Law — Regimen Especial](https://sede.agenciatributaria.gob.es): AEAT electronic office for Beckham Law application (Modelo 149) #### Italy Inbound workers regime: 50% income exemption for 5 years (reduced from 70% in 2024). 90% exemption for southern Italy. Must not have been resident in prior 2 years. Standard PIT: 23-43%. Flat tax for HNW: EUR 100k/year on foreign income. 26% CGT on financial assets. - [PwC Tax Summary — Italy](https://taxsummaries.pwc.com/italy): Complete tax profile — PIT up to 43%, CIT 24%, IRAP, withholding taxes, treaty network - [Agenzia delle Entrate](https://www.agenziaentrate.gov.it): Official Italian tax authority — codice fiscale, filing, regime impatriati info - [Regime Impatriati](https://www.agenziaentrate.gov.it/portale/web/guest/regime-agevolato-lavoratori-impatriati): Official inbound workers regime page — eligibility, application #### Greece 50% income tax exemption on employment and business income for 7 years. Must not have been resident in 5 of prior 6 years. Alternative non-dom regime (Article 5A): EUR 100k flat tax on worldwide income for HNW. Standard PIT: 9-44%. 15% CGT on listed shares. - [PwC Tax Summary — Greece](https://taxsummaries.pwc.com/greece): Complete tax profile — PIT up to 44%, CIT 22%, solidarity surcharge, treaty network - [AADE (Independent Authority for Public Revenue)](https://www.aade.gr): Official Greek tax authority — AFM registration, filing, special regime info #### Cyprus Non-dom regime: exempt from SDC (17% on dividends, 30% on interest) for 17 years. 0% CGT on securities. 12.5% CIT with 65+ treaty network. 60-day rule: can become tax resident with only 60 days of presence (if not resident elsewhere). No inheritance tax, no wealth tax. - [PwC Tax Summary — Cyprus](https://taxsummaries.pwc.com/cyprus): Complete tax profile — PIT up to 35%, CIT 12.5%, withholding, IP box, treaty network - [Tax Department of Cyprus](https://www.tax.gov.cy): Official tax authority — registration, filing, non-dom regime info #### Malta CIT 35% headline, but shareholder refund system reduces effective rate to 5%. Residence programmes: 15% flat tax on foreign income remitted (min EUR 15k/year tax). No tax on foreign capital gains not remitted. No inheritance tax, no wealth tax. - [PwC Tax Summary — Malta](https://taxsummaries.pwc.com/malta): Complete tax profile — PIT up to 35%, CIT 35% (effective 5% via refunds), treaty network - [Commissioner for Revenue — Malta](https://cfr.gov.mt): Official tax authority — registration, residence programme info #### Ireland 12.5% CIT on trading income. SARP: 30% relief on employment income above EUR 100k for 5 years. Standard PIT: 20% on first EUR 44,300, 40% above, plus USC and PRSI. 33% CGT. Remittance basis for non-domiciled residents. 70+ treaties. - [PwC Tax Summary — Ireland](https://taxsummaries.pwc.com/ireland): Complete tax profile — PIT up to 40% plus USC/PRSI, CIT 12.5%/25%, treaty network - [Revenue Commissioners — Ireland](https://www.revenue.ie): Official tax authority — PPSN, filing, SARP info - [SARP — Special Assignee Relief Programme](https://www.revenue.ie/en/employing-people/employee-expenses/special-assignee-relief-programme/index.aspx): 30% income tax relief for qualifying inbound assignees ### Europe — Low Flat-Tax EU Members #### Estonia Unique CIT: 0% on retained/reinvested profits, 20% only when distributed. 20% flat PIT. e-Residency: digital identity for managing EU company remotely (does NOT grant tax residency). Social tax: 33% by employer. No wealth tax, no inheritance tax. Full digital tax administration. - [PwC Tax Summary — Estonia](https://taxsummaries.pwc.com/estonia): Complete tax profile — 20% PIT, unique CIT system, social tax, treaty network - [Tax and Customs Board (EMTA)](https://www.emta.ee): Official tax authority — registration, e-filing - [e-Residency Programme](https://e-resident.gov.ee): Digital identity for managing an EU company remotely #### Bulgaria 10% flat PIT — the lowest in the EU. 10% flat CIT. 5% dividend WHT. Social security ~32% total capped at BGN 3,750/month. No wealth tax. Very low cost of living. EU member since 2007, Schengen since 2024. - [PwC Tax Summary — Bulgaria](https://taxsummaries.pwc.com/bulgaria): Complete tax profile — 10% flat PIT, 10% CIT, withholding, social security, treaty network - [National Revenue Agency (NRA)](https://www.nra.bg): Official tax authority — registration, filing #### Romania 10% flat PIT. Micro-enterprise regime: 1% revenue tax (1+ employees) or 3% (no employees) on companies under EUR 500k turnover. Standard CIT: 16%. 8% dividend tax (increased from 5% in 2024). 0% CGT on listed shares held >1 year. Low cost of living. EU member since 2007. - [PwC Tax Summary — Romania](https://taxsummaries.pwc.com/romania): Complete tax profile — 10% flat PIT, micro-enterprise regime, social contributions, treaty network - [ANAF (National Agency for Fiscal Administration)](https://www.anaf.ro): Official tax authority — registration, filing ### Asia-Pacific #### Singapore Territorial system: only Singapore-sourced income taxable. PIT: 0-22% (24% above S$1M from 2024). No capital gains tax. 17% CIT with partial exemption (effective ~8.4% on first S$200k). No dividend tax. CPF: up to 37% for residents/PRs. 183-day rule. - [PwC Tax Summary — Singapore](https://taxsummaries.pwc.com/singapore): Complete tax profile — PIT 0-22%, CIT 17%, withholding, GST, CPF, treaty network - [Inland Revenue Authority of Singapore (IRAS)](https://www.iras.gov.sg): Official tax authority — residency rules, filing, foreign income exemptions #### Malaysia Foreign-source income generally exempt for individuals. PIT: 0-30%. No CGT on shares/financial instruments (CGT on unlisted real property company shares introduced 2024). 24% CIT. No inheritance/wealth/gift tax. MM2H programme: long-term residence but no special tax status. 182-day rule. Low cost of living. - [PwC Tax Summary — Malaysia](https://taxsummaries.pwc.com/malaysia): Complete tax profile — PIT 0-30%, CIT 24%, withholding, SST, treaty network - [Inland Revenue Board (LHDN)](https://www.hasil.gov.my): Official tax authority — registration, filing #### Thailand Foreign income remitted to Thailand now taxable (changed 2024). PIT: 0-35%. LTR Visa: 17% flat for "work-from-Thailand professionals"; 0% on foreign income for "wealthy global citizens." No separate CGT — gains taxed as regular income. 20% CIT. 180-day rule. Very low cost of living. - [PwC Tax Summary — Thailand](https://taxsummaries.pwc.com/thailand): Complete tax profile — PIT 0-35%, CIT 20%, withholding, VAT, treaty network - [Revenue Department of Thailand](https://www.rd.go.th): Official tax authority — registration, filing - [Thailand LTR Visa (BOI)](https://ltr.boi.go.th): 10-year visa with tax benefits for qualifying professionals, investors, and retirees #### Hong Kong Strictly territorial: only HK-sourced income taxable. Salaries tax: 2-17% progressive, or 15% standard rate (whichever is lower). No capital gains tax. No tax on dividends or interest. Profits tax: 8.25% on first HK$2M, 16.5% above. No VAT/GST. No inheritance/wealth/gift tax. 60-day rule. - [PwC Tax Summary — Hong Kong](https://taxsummaries.pwc.com/hong-kong-sar): Complete tax profile — salaries tax 2-17%, profits tax 16.5%, treaty network - [Inland Revenue Department (IRD)](https://www.ird.gov.hk): Official tax authority — registration, filing ### Latin America #### Panama Pure territorial: all foreign income 100% exempt. PIT: 0-25% on local-source only. No CGT on foreign investments; 10% on local real estate. Friendly Nations Visa: fast-track residency for 50+ nationalities ($5k+ deposit). USD economy (no currency risk). No CFC rules. - [PwC Tax Summary — Panama](https://taxsummaries.pwc.com/panama): Complete tax profile — PIT up to 25%, CIT 25%, territorial system, treaty network - [Direccion General de Ingresos (DGI)](https://dgi.gob.pa): Official tax authority — registration, filing #### Paraguay Territorial: all foreign income fully exempt. 10% flat PIT on local-source. 10% flat CIT. No CGT as separate category. No inheritance/wealth tax. Very easy permanent residency (~$5,500 deposit). Lowest cost of living in South America. No tax treaties. - [PwC Tax Summary — Paraguay](https://taxsummaries.pwc.com/paraguay): Complete tax profile — 10% flat PIT, 10% CIT, territorial system - [Subsecretaria de Estado de Tributacion (SET)](https://www.set.gov.py): Official tax authority — registration, filing #### Costa Rica Territorial: foreign income fully exempt. PIT: 0-25% on local income. Digital Nomad Visa: 1-year visa for remote workers earning $3k+/month, exempt from local income tax. 30% CIT. Social security (CCSS) mandatory at ~37%. Higher cost of living than other LatAm territorial countries. - [PwC Tax Summary — Costa Rica](https://taxsummaries.pwc.com/costa-rica): Complete tax profile — PIT up to 25%, CIT 30%, territorial system - [Ministerio de Hacienda](https://www.hacienda.go.cr): Official tax authority — registration, filing - [Digital Nomad Visa](https://www.migracion.go.cr): 1-year visa for remote workers — $3k/month requirement, exempt from income tax #### Uruguay New resident tax holiday: foreign-source investment income exempt for first 11 fiscal years. After holiday, 12% flat rate on foreign investment income. PIT: 0-36% on local-source. 25% CIT. Free Trade Zones: 0% tax. Good banking system, politically stable. - [PwC Tax Summary — Uruguay](https://taxsummaries.pwc.com/uruguay): Complete tax profile — PIT up to 36%, CIT 25%, IRAE, IRPF, treaty network - [Direccion General Impositiva (DGI)](https://www.dgi.gub.uy): Official tax authority — registration, filing #### Mexico Worldwide taxation — NOT a low-tax jurisdiction. PIT: 1.92-35%. 30% CIT. Included for proximity to US, large nomad community, and treaty network (60+ treaties). Temporary resident visa holders may argue non-resident status (legally complex). No specific digital nomad tax regime. - [PwC Tax Summary — Mexico](https://taxsummaries.pwc.com/mexico): Complete tax profile — PIT up to 35%, CIT 30%, withholding, VAT, treaty network - [Servicio de Administracion Tributaria (SAT)](https://www.sat.gob.mx): Official tax authority — RFC registration, filing ### Middle East #### United Arab Emirates 0% personal income tax on all income types. 9% CIT (June 2023) on corporate profits above AED 375k. Free zones: 0% CIT on qualifying income with substance requirements. No CGT, no WHT on dividends/interest. 5% VAT. Multiple visa options: Golden Visa (10yr), Green Visa (5yr), Freelancer Visa. 130+ tax treaties. High cost of living in Dubai/Abu Dhabi. - [PwC Tax Summary — UAE](https://taxsummaries.pwc.com/united-arab-emirates): Complete tax profile — 0% PIT, 9% CIT, free zone provisions, VAT 5%, treaty network - [Federal Tax Authority (FTA)](https://tax.gov.ae): Official tax authority — corporate tax registration, VAT filing, residency confirmation #### Bahrain 0% personal income tax. 0% CIT (except 46% on oil & gas). No CGT, no WHT. 10% VAT. Lower cost of living than UAE. Bahrain Golden Residency Visa for property owners (BHD 200k+). Growing fintech hub. 40+ treaties. - [PwC Tax Summary — Bahrain](https://taxsummaries.pwc.com/bahrain): Complete tax profile — 0% PIT, 0% CIT, VAT 10%, treaty network - [National Bureau for Revenue (NBR)](https://www.nbr.gov.bh): Official tax authority — VAT registration, filing ### Caribbean #### Cayman Islands No income tax of any kind — 0% on salary, business profits, dividends, interest, capital gains, crypto. No CIT, no WHT, no inheritance/gift/wealth tax. Revenue from import duties (22-27%), work permit fees, financial services fees. Economic Substance Law (2019). Residency: Certificate of Permanent Residence (CI$2.4M+ investment) or Persons of Independent Means ($120k+ annual income). High cost of living. CRS participant (100+ info exchange agreements). - [PwC Tax Summary — Cayman Islands](https://taxsummaries.pwc.com/cayman-islands): Complete tax profile — no direct taxes, economic substance requirements - [Cayman Islands Government](https://www.gov.ky): Official portal — residency permits, substance notifications, immigration #### Bahamas No income tax — 0% on all personal and corporate income. No CGT, no inheritance/wealth tax. Revenue from VAT (10%), import duties, real property tax. Permanent Residency with property >$750k. Geographic proximity to US (45min from Miami). No CFC legislation, no exchange controls for non-residents. - [PwC Tax Summary — Bahamas](https://taxsummaries.pwc.com/the-bahamas): Complete tax profile — no direct taxes, VAT, stamp duty - [Bahamas Department of Inland Revenue](https://inlandrevenue.finance.gov.bs): Official tax authority — VAT registration, real property tax ### Caucasus #### Georgia 20% flat PIT. 1% revenue tax for small business status (under GEL 500k / ~$190k). Virtual Zone Person (VZP): 0% CIT on IT service exports; 5% on dividends. 15% standard CIT (credit method, similar to Estonian model). 0% tax on foreign dividends for individuals. 0% CGT on listed securities. Visa-free 1 year for 95+ countries. Very low cost of living. 56 tax treaties. - [PwC Tax Summary — Georgia](https://taxsummaries.pwc.com/georgia): Complete tax profile — 20% flat PIT, 15% CIT, small business status, virtual zone, treaty network - [Revenue Service of Georgia](https://rs.ge): Official tax authority — registration, TIN application, filing - [Virtual Zone Person Program](https://virtualzone.gov.ge): 0% CIT on international IT service revenue for certified IT companies --- ## Optimization Strategies by Profile ### Freelancers & Solo Consultants (EUR 50k-300k) Freelancers have the most flexibility — income is client-based, location-independent, and doesn't create PE risks. If you bill foreign clients from a territorial country, your income is foreign-sourced and taxed at 0%. Key variables: PIT, social security contributions (often 15-35% on top of PIT, the hidden cost that ruins plans), VAT, invoicing rules, residency triggers. **Tier 1 — Territorial (0% foreign income):** Paraguay (0%, minimal social security, very low cost), Panama (0%, USD economy, good banking), Costa Rica (0% + DN visa, but CCSS ~37%), Georgia (1% small biz, easy residency, very low cost). **Tier 2 — Low flat-tax EU:** Romania micro (1-3% revenue tax via SRL, effective 3-8% with salary), Bulgaria (10% flat PIT, ~15-20% total with social security), Estonia OU (0% retained / 20% distributed, not a personal tax solution unless you live in a low-tax country). **Tier 3 — Special expat regimes:** Spain Beckham (24% flat, 6yr), Portugal IFICI (20% flat, 10yr), Italy Impatriati (~15-22% effective, 5yr), Greece (~22% effective, 7yr). Require qualifying activities — verify eligibility. **Structures:** Direct freelancing (sole proprietor), Personal company (LLC/SRL/OU), Micro-enterprise/small business status. Social security traps: EU coordination (Regulation 883/2004) means you pay where you live; bilateral agreements prevent double contributions; countries without agreements (Georgia, Paraguay, Panama) = potentially no obligation. - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): Country-by-country PIT rates, social security, filing requirements - [OECD — Taxing Wages](https://www.oecd.org/tax/taxing-wages/): Comparative data on tax wedge across OECD countries - [EU Social Security Coordination](https://ec.europa.eu/social/main.jsp?catId=849): EU rules on which country's social security applies ### Company Owners & Entrepreneurs Combined burden = CIT on profits + PIT on distributions + social security. Low CIT is only valuable if you can extract profits cheaply (Ireland: 12.5% CIT but 40%+ PIT on distributions). **Key structures:** Estonia OU (0% retained, 20% on distribution — ideal for reinvesting), UAE Free Zone (0%/9% CIT + 0% PIT — substance required), Cyprus non-dom (12.5% CIT + 0% dividend SDC for 17yr, IP box at effective 2.5%), Ireland (12.5% CIT trading, 70+ treaties, but high extraction cost), Bulgaria EOOD (10% CIT + 5% dividend = ~14.5%), Romania SRL micro (1-3% + 8% dividend = ~9-11%). **Substance is critical:** Physical presence, real employees, decision-making in-country, adequate expenditure. Red flags: no employees, board meetings elsewhere, all work from another country, no local expenses. **CFC rules:** Origin country can tax undistributed profits of a foreign company you control (>50%). Triggered when foreign company is in low-tax jurisdiction with passive income. Key rules: Spain (passive income attributed), France (>50% + <60% of French rate), Germany (>50% + passive below 25%), UK (>25% interest), US (GILTI 10.5-13.125% minimum + Subpart F). Avoid by generating active income, meeting substance, avoiding ultra-low-tax jurisdictions, or cleanly exiting origin country. - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): CIT rates, holding regimes, withholding tax by country - [OECD Transfer Pricing Guidelines](https://www.oecd.org/tax/transfer-pricing/): Arm's length pricing standards - [EU Anti-Tax Avoidance Directive (ATAD)](https://taxation-customs.ec.europa.eu/): EU minimum standards for CFC rules, interest limitation, exit taxation - [Tax Foundation — Corporate Tax Rates](https://taxfoundation.org/research/all/global/corporate-tax-rates-by-country/): Comparative CIT rates ### Remote Workers (Employed by Foreign Company) Core problem: your remote work may create a Permanent Establishment (PE) for your employer — forcing them to register, file, and pay taxes in your country. PE risk is the biggest constraint. **When PE is created:** Fixed place of business (home office 6+ months), dependent agent (authority to conclude contracts), service PE (183+ days in 12 months). **When NOT:** Short stays (<183 days), preparatory/auxiliary work, digital nomad visas explicitly preventing PE. **Digital nomad visa programs:** Spain (DN Visa + Beckham 24%, EUR 3,120/mo), Portugal (D8 + IFICI 20%, ~EUR 3,400/mo), Greece (DN + 50% reduction 7yr, EUR 3,500/mo), Estonia (DN up to 1yr, EUR 4,500/mo), Georgia (Remotely from Georgia 1yr, $2k/mo), Costa Rica (DN 1yr, $3k/mo, exempt), Croatia (DN 1yr, EUR 2,540/mo, exempt), Thailand (LTR 10yr, $80k/yr, 17% flat). **Social security:** EU A1 certificates determine which country's system applies. General rule: pay where you work. Posting exception up to 24 months. Multi-state workers: pay in country of residence if >25% work there. EOR services (Deel, Remote, Oyster) handle compliance but don't optimize tax. - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): PE rules, payroll obligations, social security rates - [OECD — Model Tax Convention](https://www.oecd.org/tax/treaties/): Article 5 (PE), Article 15 (employment income), remote work PE guidance - [EU Social Security Coordination](https://ec.europa.eu/social/main.jsp?catId=849): A1 certificates, multi-state workers, posting ### Investors (Passive Income: Dividends, Capital Gains, Crypto) Key question: "Where should I live given WHERE my investments are?" Each income type (CGT, dividends, interest, rental, crypto) is taxed differently across jurisdictions. **CGT comparison (securities):** UAE 0%, Hong Kong 0%, Cayman 0%, Malaysia 0% (most), Cyprus non-dom 0%, Singapore 0% (investment), Georgia 0% (listed), Bulgaria 10%, Romania 0% (listed >1yr), Portugal 28%, Spain 19-28%, France 30%, Germany 26.375%, US 0/15/20%. **Dividend taxation:** Source country withholds (15-30%), residence country taxes, treaty reduces withholding, foreign tax credit prevents double taxation. Treaty shopping risks: LOB clauses and PPT (Principal Purpose Test) under BEPS. Key treaty network hubs: Cyprus (65+), Malta (70+), Singapore (90+), Netherlands (90+), Ireland (70+). **Crypto 0% jurisdictions:** UAE, Hong Kong, Cayman, Malaysia, Singapore (investment), Georgia (likely), Germany (after 1yr hold). Heavy tax: US (0-37%), Spain (19-28%), France (30%), Italy (26%), Portugal (28% since 2023). **Wealth taxes to avoid:** Spain (0.2-3.5% + solidarity 1.7-3.5%), Norway (0.95-1.1%), Switzerland (0.1-1% by canton), France IFI (0.5-1.5% real estate only), Netherlands Box 3 (~31% on deemed return). 1% wealth tax on EUR 5M = EUR 50k/year regardless of returns. - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): CGT rates, WHT rates, treaty details by country - [OECD Tax Treaty Database](https://www.oecd.org/tax/treaties/): Full text of treaties and withholding rate tables - [Tax Foundation — Capital Gains Tax Rates in Europe](https://taxfoundation.org/research/all/global/capital-gains-tax-rates-in-europe/): Comparative CGT rates - [OECD — Crypto-Asset Reporting Framework (CARF)](https://www.oecd.org/tax/exchange-of-tax-information/crypto-asset-reporting-framework-and-amendments-to-the-common-reporting-standard.htm): International framework for automatic exchange of crypto info --- ## Exit Planning Leaving a high-tax country isn't just about where you go — it's about how you leave. Getting it wrong means paying taxes in BOTH countries, sometimes for years. ### Exit Taxes by Country **Spain:** Applies to residents 10 of last 15 years with shares >EUR 4M or >25% in entities >EUR 1M. Taxed at savings rates (19-28%). 4-year clawback (10 years for tax havens). EU/EEA deferral over 5 years with bank guarantee. **France:** Residents 6 of last 10 years with >50% shareholding or gains >EUR 800k. Taxed at PFU 30%. EU/EEA automatic deferral, no guarantee required. Tax extinguished after 2 years (gains <EUR 2.57M) or 5 years if assets still held. **Germany (Wegzugsbesteuerung):** Residents 7 of last 12 years holding >=1% of any corporation. 60% of gain taxed at PIT rates (effective ~27%). EU/EEA interest-free deferral over 7 years. Extended tax liability on German-source income for 10 years. **United States (Expatriation Tax):** Covered expatriates: >$2M net worth OR >$201k avg tax over 5 years OR non-compliance. Mark-to-market: ALL assets deemed sold at FMV. Gains above $866k exclusion at regular CGT rates. NO deferral — due immediately. Citizenship-based taxation: only escape is renouncing citizenship. **Norway:** 5-year latent gains rule — sell within 5 years = Norway taxes at 22%. Hold 5+ years = claim expires. Also has wealth tax (0.95-1.1%). **Netherlands:** Conserving assessment on >=5% shareholdings. Box 2 rates: 24.5% on first EUR 67k, 33% above. EU/EEA automatic deferral. Expires after 10 years if shares still held. **Sweden:** 10-year rule on Swedish company shares — gains taxable at 30% for 10 years after departure. Many treaties override this. Applies only to Swedish company shares. **EU constraints:** ECJ rulings require deferral for intra-EU moves without bank guarantee. Gain must be recalculated if asset decreases post-departure. Non-EU moves can be taxed immediately. - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): Country-specific exit tax rules and rates - [OECD — Model Tax Convention](https://www.oecd.org/tax/treaties/): Article 13 (capital gains) and commentary on exit taxes - [EU Anti-Tax Avoidance Directive (ATAD)](https://taxation-customs.ec.europa.eu/): Article 5 — EU-wide exit taxation rules - [ECJ Case Law on Exit Taxes](https://curia.europa.eu/): Key cases: C-9/02 (de Lasteyrie), C-470/04 (N), C-164/12 (DMC), C-581/17 (Wachtler) ### Substance Requirements Tax residency determined by: (1) permanent home, (2) center of vital interests (personal + economic relations — most important), (3) habitual abode, (4) nationality (tiebreaker). Spouse/family location is the #1 factor. **Red flags triggering audits:** Spouse remains in origin country, children in school there, keeping a home, primary bank accounts still there, social media geolocation, frequent return flights, clients predominantly there. **Establishing substance:** Secure long-term housing (12+ months), register with local authorities, get local tax ID, open local bank account, register for healthcare, transfer financial relationships, file taxes in new country (even if 0%), deregister from origin country. Keep records: flight records, rental agreements, utility bills, bank statements, healthcare records, local tax filings. **Country-specific:** Cyprus 60-day rule (lightest EU requirement), UAE 90+ days or permanent home + 30 days, Spain Beckham requires employment by Spanish entity, Portugal IFICI requires 183 days + high value-added activity. **Digital nomad trap:** Being resident "nowhere" = being "everywhere." Origin country may still claim you, multiple countries may tax you, no treaty protection, banking difficulties, CRS reporting issues. Always be tax resident SOMEWHERE. - [OECD Model Tax Convention — Article 4](https://www.oecd.org/tax/treaties/): Tiebreaker rules for dual residency - [EU Tax Policy — Anti-Avoidance Directives](https://taxation-customs.ec.europa.eu/): EU substance requirements and anti-abuse provisions - [OECD — Common Reporting Standard (CRS)](https://www.oecd.org/tax/automatic-exchange/): Automatic exchange of financial account information ### Tax Treaties Treaties allocate taxing rights by income type: employment (where work is performed), business profits (country of PE), dividends/interest (source at reduced rate + residence), capital gains on shares (usually residence), capital gains on property (source), royalties (varies). Prevent double taxation via credit method or exemption method. **Tiebreaker rules (Article 4):** Permanent home → center of vital interests → habitual abode → nationality → mutual agreement. Only apply when a treaty exists. **Anti-treaty shopping:** LOB clauses (ownership, active business, derivative benefits tests), PPT under BEPS MLI (benefits denied if principal purpose was obtaining them). Protect by having genuine residence, substance, business purpose, documentation. **PE risk from remote work:** Home office 6+ months = moderate-high risk. Contract-concluding authority = high risk (agent PE). DN visa = usually no PE. Short stays <183 days = low risk. **Treaty network hubs:** Cyprus (65+), Malta (70+), Ireland (70+), Netherlands (90+), Singapore (90+), UAE (130+), Luxembourg (80+), Switzerland (100+). - [OECD Treaty Database](https://www.oecd.org/tax/treaties/): Full treaty texts and MLI - [OECD Model Tax Convention](https://www.oecd.org/tax/treaties/model-tax-convention-on-income-and-on-capital-condensed-version-20745419.htm): Articles 1-30 with commentary - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): WHT rate tables showing treaty rates for every country pair ### Timing & Residency Mechanics The 183-day rule is a guideline, not universal. Spain uses center of vital interests as primary test. France has four alternative tests (any one triggers residency). Germany: maintaining a dwelling = resident regardless of days. UK: complex Statutory Residence Test. Netherlands: holistic "durable ties" approach. Portugal: rolling 12-month period. Thailand: 180 days. Malaysia: 182 days. UAE: 90 days + permanent home. Cyprus: 60-day option. **Split-year rules:** UK allows split-year (SRT cases 1-8). Netherlands allows mid-year migration. France does NOT allow split year. Spain does NOT have split year (leave before July 1 if counting on 183-day rule). Germany: unlimited liability until departure date. **Optimal timing:** January 1 best for calendar-year countries (Spain, France, Germany, Italy). July 1 works for UK and Netherlands (split-year). Avoid November/December (too many days accumulated). **Registration/deregistration steps:** Spain (cancel padron, file Modelo 100/151), Portugal (notify AT, cancel IFICI), Germany (Abmeldung at Einwohnermeldeamt), Italy (register AIRE, cancel at Comune), UK (Form P85 to HMRC, SRT determines status). - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): Country-specific residency rules, day-counting, filing requirements - [OECD Model Tax Convention — Article 4](https://www.oecd.org/tax/treaties/): Residency definition and tiebreaker rules - [HMRC — Statutory Residence Test](https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt): UK's official SRT guidance and worked examples - [EU Free Movement of Persons](https://ec.europa.eu/social/main.jsp?catId=457): Rights of EU citizens to establish residence in any EU member state --- ## Decision Framework ### By Tax Model — Quick Comparison | Dimension | Worldwide | Territorial | Zero-Tax | Special Regime | |---|---|---|---|---| | Foreign income taxed? | Yes — all | No — only local | No — none at all | Varies — often exempt or flat | | Typical PIT rate | 30-50%+ | 15-25% on local | 0% | 15-24% flat for qualifying period | | CGT | Yes (15-30%) | Usually no (foreign) | No | Often exempt | | Duration | Permanent | Permanent | Permanent | 5-17 years | | Cost of living | Varies | Low-Medium | High (UAE, Cayman) | Medium (EU) | | EU residency? | If EU country | No | No | Yes (EU regimes) | ### By Profile — Top Picks **Freelancers:** Paraguay (0% foreign), Panama (0% foreign), Romania (3% micro), Bulgaria (10%), Georgia (1%), Spain Beckham (24%). **Company Owners:** Estonia OU (0% retained), UAE Free Zone (0%/9%), Cyprus non-dom (12.5% + 0% div), Ireland (12.5%), Bulgaria (10% + 5%). **Remote Workers:** Spain Beckham (24%), Portugal IFICI (20%), Georgia (1-20%), Estonia (20%), Greece (50% reduction). **Investors:** UAE (0%), Cayman (0%), Cyprus non-dom (0% CGT securities), Malaysia (0% foreign), Hong Kong (0%), Georgia (0% listed). ### Quick Decision Tree **Active income + need EU?** Budget >EUR 100k → Spain Beckham / Portugal IFICI. Budget EUR 30-100k → Bulgaria / Romania micro. Budget <EUR 30k → Romania / Georgia. **Active income + location-flexible?** Lowest tax → Paraguay / Panama. Good infrastructure → Georgia / Malaysia. English-speaking → Singapore / Hong Kong. **Passive income + zero CGT?** High budget → UAE / Cayman. Medium → Cyprus non-dom. Lower → Malaysia / Georgia. **Company owner?** Retain profits → Estonia OU. Low CIT + dividends → Cyprus / Bulgaria. No CIT → UAE Free Zone. EU holding → Ireland / Cyprus. **Always:** Check exit taxes for your origin country and substance requirements before committing. ### By Origin Country — Exit Considerations **Spain:** Exit tax on assets >EUR 4M, 10-year clawback for tax havens, center of vital interests primary test. **France:** Exit tax on gains >EUR 800k, EU deferral, CSG/CRDS on French-source income after departure. **Germany:** Wegzugsbesteuerung on >=1% shareholdings, extended tax liability 10 years. **UK:** No general exit tax, split-year available via SRT, CGT on UK property remains. **US:** Expatriation tax for covered expatriates (>$2M net worth), mark-to-market on all assets, citizenship-based taxation. **Nordics:** Sweden 10-year rule on Swedish shares, Norway 5-year latent gains, high social contribution loss. --- ## Key External References - [OECD Tax Portal](https://www.oecd.org/tax/): Global tax policy data, country comparisons, and the international tax framework - [PwC Worldwide Tax Summaries](https://taxsummaries.pwc.com/): Free, annually-updated tax profiles for 150+ countries — PIT, CIT, WHT, social security, treaties - [Tax Foundation](https://taxfoundation.org/): Nonprofit tax policy research — international competitiveness index, rate comparisons, policy analysis - [EU Tax Policy](https://taxation-customs.ec.europa.eu/): European Commission resources on EU tax coordination and directives