Taxaholic Countries for Expats to Avoid

As if taxaholic France wasn't already in the news for the departure of Gerard Depardieu for more welcoming Russia, now comes a whopper!  More than 8,000 French households got tax bills for 2012 - dunned for taxes which exceed their income for the entire year.  Expect more departures from the no-longer-so-belle France.

We've mentioned countries with no personal income taxes.  Here's some horrible news about the EU: very few countries in the world tax like the EU.  Only Aruba, US, and Japan can rival Euro-kleptocrats. 

EU's worst:
Hungary - 59.4%
Belgium - 58.5
France - 56.4 (except for some, income taxes exceed 100% of income)
Germany - 54.6
Austria - 52.2
Netherlands - 50.2
Sweden - 49.4
Romania - 48.6
Italy - 46.0
Denmark - 45.7
Slovakia - 45.5
Lithuania - 45.4
Finland - 45.2

Only Cyprus (19.4%) and Malta (26.8%) have tax rates below 30%.  As we've all heard and read, Cyprus is broke, so it simply confiscated people's bank accounts.  That's Tax with a Capital T-plus!

What to do if your employer transfers you to one of these on an expat contract?  Try to find an alternative!  What if you're a citizen?  Do you want to be a milk cow for taxaholics?  Or do you want to enjoy the PT life?  You have a very potent incentive to be a non-resident citizen if you're from an EU country.

Think the grass is greener on the US side of the border?  People tend to think it "looks good" because charts like these only consider federal income taxes.  For the US, you have to add Social Security (FICA) and Medicare, which take another 7.65% from the first dollar you earn.  There's the new Medicare surcharge on top of that for those with higher-level incomes.  Don't forget state income taxes, which vary considerably.  Add it all up, and the US can turn out to the be the Ultimate Taxaholic for a lot of taxpayers.

If you are a US person (which includes more than citizens and legal permanent residents and workers on visas), non-resident status is no cure.  There's the Foreign Earned Income Exclusion, a small help to some.

Planning your travels, planning your expat-life, planning retirement relocation?  Whatever you do and wherever you go, tax planning must be a major consideration in the decision-making process for every Road Warrioress.

So, where are you headed?  What works well for you?  Share your thoughts.  We'd all love to hear them.

May your road rise to meet you!
Ann