6 Tax-Friendly Overseas Havens for Retirees
A new report from the overseas experts at International Living highlights six countries where expats can protect their foreign-earned income and live well for less.
A recent survey conducted by International Living revealed that 78% of respondents are concerned about the financial implications of the next U.S. presidential administration. In response, International Living has identified six tax-friendly countries where expats can shield their foreign-earned income and enjoy a high quality of life.
“You can’t simply up and move abroad to any country that appeals to you—you’ve got to consider factors like the ease with which you can obtain a long-term visa, the accessibility, the local language, the cost of living and, too, the tax implications,” said Jennifer Stevens, Executive Editor at International Living.
“The countries we’ve highlighted in this new report each provide a favorable tax situation for folks who might move there but whose income would remain foreign earned. Also, they offer good-value living, welcoming locals, beautiful surroundings, and established expat communities. In other words, they make for good places to live, even if the tax question isn’t your first concern.”
As political tensions escalate and potential tax increases loom, many expats and retirees are looking for countries that offer both financial security and a peaceful lifestyle. The following six countries fit the bill.
“In uncertain times, protecting your retirement savings is paramount,” Stevens added. “These countries offer excellent opportunities to minimize taxes and secure your financial future while enjoying all the benefits of living abroad.”
For more information, read the full report here: 6 Tax-Friendly Destinations Where You Can Live Well for Less Overseas
1. Panama
Panama offers a territorial tax system, meaning that only income generated within the country is taxed. Retirees and investors with foreign-sourced income can live tax-free, and Panama’s Pensionado Program provides additional benefits such as discounts on healthcare and utilities.
Proximity to the U.S. (about a 3-hour flight from Miami), a strong dollarized economy (Panama adopted the USD over 100 years ago), affordable quality healthcare and low property taxes are other pluses.
Panama ranked No. 4 in IL’s 2024 list of Best Places in the World to Retire.
- Key Benefit: No tax on foreign income, plus deep discounts for retirees.
- Cost of Living: $2,000 to $4,000 per month for a couple.
2. Costa Rica
With no taxes on foreign-earned income and easy residency options through the Pensionado and Rentista programs, Costa Rica remains a favorite for retirees seeking financial security. The country also returned to the top spot in IL’s 2024 list of Best Places in the World to Retire.
People appreciate the stability Costa Rica offers in an increasingly divided world. Lauded as the Switzerland of Central America, Costa Rica abolished its army in 1948, shifting funding toward healthcare and education. It’s internationally recognized for its environmental commitment; a quarter of its land is protected as national parks and wildlife refuges. Additionally, it has recently been operating 98% on renewable energy.
- Key Benefit: Zero taxes on foreign income.
- Cost of Living: $2,000 to $2,500 per month for a couple.