|
You have worked hard your whole life, and have been taxed every step of the way. If you are thinking of retiring, here are five options to consider:
1. Cyprus
In number 1 spot is Cyprus. It tops the list of exotic destinations mainly because it has an income-tax rate of only 5% on all pensions for retired residents, as well as low property prices and no inheritance tax. It is also favored for its hot, dry summers, warm winters as well as its English speaking population.
The average price of a two bedroom property in Cyprus is only $77,000, though the islands property market is quickly catching up with prices in more established retirement hotspots such as France and Spain. Many see this as a benefit though, looking to Cyprus as a good place to invest in property, considering the state of the housing market in the rest of the world.
With southern Cyprus recently joining the European Union, pensioners from other EU countries are entitled to use the public health system free of charge, providing another financial incentive.
2. Panama
Panamas main attraction, (not including its year-round 30 Deg Celsius temperature), is the fact that English is widely spoken among the population, you have worked hard enough through your life, you do not really want to be learning a new language when you retire! There are numerous other benefits including a lower cost of living compare to Cyprus and other countries listed, a minimal crime rate and, for retirees, its pensio-nado scheme which offers numerous discounts on services including as healthcare, leisure activities and public transport. Another advantage is that Income from capital outside of Panama, whether they be your pension, bank deposits or your investment portfolio, is completely free from tax.
Do not presume you will escape tax altogether, however. There may be no inheritance tax as such, however, gifts of property attract rates from 4% to 33% depending on your relationship with the beneficiary, so make sure that you check before considering any such gifts. Anyone purchasing property may apply for permanent residence in Panama, one year after having applied for a residence visa, as long as the total value of the property and any bank deposits equals in excess of $200,000.
3. France
The country with the best quality of living on the list has to go to France. Despite the obvious language barrier, this will easily be made up for with the culture and cuisine this amazing country has to offer. If you are planning to retire with a large income, then France might not be the best option as the top rate of income tax in France is 49.8%, however retired couples with income of $70,000 or less would still be better off making the move because in France there are lower rates the lower your income.
Housing prices have increased dramatically in recent years, but this increased cost will be made up for by one of the best health care systems in the whole world. Something you really might need to consider when you reach retirement.
4. Belize
Belize has a tropical climate with temperatures ranging between a steady 24 and 27 degrees Celsius, however people should be aware of Belizes rainy season, which is likely to put some people off.
Despite this, however, it has always been a popular destination for American retirees. The income tax rate for citizens living in Belize is set at a low 1.75%, but income such as pensions is completely untaxed. On top of this there is no capital gains tax or inheritance tax for people looking into retiring to Belize. For those who can not wait until they are 65 there are advantages to early retirees also.
Investors in the island can direct foreign business activities from the country, as long as they have an income of $2,000 a month and are at least 45 years old. They can also import a car, light aircraft, boat and any personal belongings duty free. Compared to other places in the Caribbean, Belize is quite reasonable for property prices, with a 3 bedroom, beachfront villa costing $350,000. Anyone who is aged 45 or over can apply for residency through a retirement programme set up by the Belize government.
5. Spain
Spain is similar to France in that it has a good number of British speaking communities dotted around the country and it is one of the most popular retirement destinations for English people.
There are however a number of tax traps for those thinking of selling their property and moving to Spain which is why it has taken 5th place. If you are resident of Spain (I.E. spend more than 183 days there a year) you must pay tax at up to 40% on any income from your UK pension, bank accounts and investment portfolio. Capital gains tax may have been reduced last year from 35% to 18% however there is also a wealth tax of 0.2% to 0.5% of all citizens worldwide assets to consider.
One final thing for expats to consider is that they are liable to pay Spanish inheritance tax, regardless of the country in which the inheritance is situated. Spain is a wonderful, stable country, with an amazing culture but the above tax implications should be a big consideration for anyone thinking about retiring there. A Typical property will cost you around $137,000 and property costs amount to around 10%, which is higher than in many other countries.
Author Resource:- Need help claiming tax back ? Find out if you are due a refund by using Tax Fix's Tax Rebate calculator .
|