For decades, the countries of Southern Europe have offered an amazing lifestyle and a low cost of living.
So it’s no surprise that retirees from Northern Europe have been flocking to the shores of Spain, Portugal, Italy, etc. to spend their golden years there.
But there has always been a serious barrier for people wishing to relocate to the region – especially for those not yet retired: onerous taxation.
Even moderate earners (by North American standards) were historically subject to some of the world’s highest rates if they became tax residents anywhere in the region. Between income taxes and social security contributions, you would normally part with more than half your income.
(And due to these countries’ residence-based taxation regimes, you generally must pay taxes on your worldwide income.)
Fortunately, a few years ago, we started to see important changes in this regard. The local governments realized that in order to reverse the brain drain their countries experienced, and to attract new residents, they must offer lucrative tax incentives.
Today, pretty much every country in Southern Europe (plus Switzerland) offers some sort of a tax incentive for new residents.
As a result, you can now combine the relaxed lifestyle of the Mediterranean with (much) lower taxes.
And considering that these tax deals last between five and fifteen years, you could enjoy low taxes for a good while by moving from one country to another.
If you are excited about this new development, make sure to check out this report for more information about the various tax incentives in Southern Europe.
Countries of Southern Europe are largely known for two things: Their relaxed and pleasant lifestyles, beautiful nature, great food, rich history, and Being a generally poor environment for productive individuals. The first point generally leads to the second: “Mañana culture” is prevalent everywhere in the region. People work to live there, not the other way…
