Where are the world’s lowest tax rates?

If you’re in the process of choosing a new home you might take a look at these low-taxing nations. It’s a great strategy to maximise wealth. But don’t let the tax rate define your ultimate decision, though. There’s many other factors you need to consider including, safety, security, opportunities (or lack of), standard of living and more.

Wherever you choose though . . . we’ve got your Australian expat tax returns and tax advice covered though, so that’s one less thing to worry about.

Here are the five lowest income tax rates in the world.

Zero percent

Yes, there are nations on this planet where the government takes none of your income. That’s why they’re called tax havens. These include the Bahamas, Bahrain, Cayman Islands, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates and Vanuatu. Of them all the obvious pick for an Aussie expat is Vanuatu – it’s not too far from home and it doesn’t have the blatant tax-dodging aroma of the Cayman Islands.

Seven percent

This can be found in Guatemala. Looking at their ancient ruins, which are famous throughout the world, you have to wonder if such a low tax rate is a good idea. They could probably fix those ruins with a slightly higher tax income – or are we missing the point on that one?

10 percent

This is a nice, neat figure that must make calculating your tax each year incredibly easy. All you’d have to do is move a decimal point. You can receive this in Bosnia and Herzegovina, Bulgaria, Kazakhstan, Macedonia and Mongolia.

12 percent

In Macau you can pay as little as 12 percent tax on your income, though this is a slightly deceptive one. Macau has a gradual tax system and the lowest rate only kicks in if you earn more than MOP424,000, which equates to roughly $70,000.

13 percent

This unlucky number can be found on your tax return in Russia and Belarus.

So where are the highest tax rates?

We can’t end this look at tax rates without flipping the coin and seeing where the highest are. That title undoubtedly goes to the Scandinavian region, where Sweden claims the overall title with a personal income tax rate of 57 percent. She is closely followed by her neighbours Denmark, Finland and the Netherlands, who are all over 50 percent.

And then of course there’s Australia. With an effective tax rate of 49% (including the 2% Medicare Levy and 2% Temporary Budget Repair Levy), we’re up there with the Scandinavians! With rates that high, it’s important to receive expert Australian tax advice whenever you’re circumstances change, or you’re considering changes. Get it right and you can save literally tens of thousands of dollars . . . and more!

For more expat tax advice or assistance with your Australian tax returns, contact us today.

Photo: The world by Naina_94 licensed under Creative commons 2
Shane Macfarlane
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Shane Macfarlane

CEO & Founder at Expat Tax Services
Shane's an Australian Chartered Accountant and Australian expat tax specialist who's also an expat himself (based in Asia).Shane's passionate about tax and legitimate tax minimisation, particularly as it relates to Australian expats who are often subject to high rates of tax back home in Australia.Beyond tax and accounting, Shane's an entrepreneur, having devised, created and founded a successful accounting startup, Fifo Workpapers (acquired by accounting software giant, Intuit inc. in 2013)

In short Shane's a tax and software techno-geek, who recognised that Australian expats were unable to obtain the specialist advice and quality service, that they needed from their accountants. Accordingly, Shane founded Expat Tax Services to provide Australian expats with access to specialist, quality advice at fair and reasonable prices (no hourly rates, fees quoted upfront with unlimited support included) . . . receive the support and advice you need without having to take second-mortgage to pay your accountant's bill! Speak to Shane & the team today.
Shane Macfarlane
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