Moving Abroad: Salary, Tax & Living Costs
Compare salary after tax, social contributions and living costs before moving abroad.
3 min read
A bigger foreign salary does not automatically mean a better life—and a lower tax rate does not automatically mean more disposable income. A useful comparison keeps tax, compensation and cost of living separate until the final step.
Start with two real offers
Currency-converting your present salary answers a tax-system question, not a job-market question. When possible, compare the gross compensation you could actually earn in each location, including fixed allowances and mandatory bonuses.
- Base salary and guaranteed bonuses
- Employer pension or retirement contributions
- Health insurance and paid leave
- One-off relocation support
Model residency before rates
Income tax normally follows tax residence and source rules—not citizenship alone. Confirm when residence begins, whether split-year treatment exists, and whether your former country continues to tax particular income.
US citizens and green-card holders are a major exception because federal filing can continue abroad. Treaty relief, the foreign earned income exclusion and foreign tax credits are separate calculations.
Compare disposable income last
After estimating payroll deductions, add rent, healthcare, childcare, transport, visa costs and trips home. Treat PPP indices as orientation, then replace broad indices with your own likely budget.
Work through an offer comparison
Consider two fictional offers: GBP 75,000 in the United Kingdom and EUR 65,000 in Spain. Do not enter 75,000 for both countries. Choose “Different job offers”, put each amount in its local-currency field, and use annual pay periods. Select EUR as the comparison currency so both results share a unit. These are example offers, not market salary benchmarks.
Next, enter a monthly spending plan: perhaps GBP 2,800 for the UK and EUR 2,200 for Spain. The calculator subtracts each budget from the corresponding monthly net and then converts the remainder. Replace every budget item with your own research. If an employer covers housing, avoid counting it both as extra salary and as a reduction in rent.
Stress-test the decision
Repeat the comparison with higher rent, a less favorable exchange rate and no discretionary bonus. For an illustrative monthly net of EUR 4,000 and costs of EUR 2,700, the remainder is EUR 1,300. A EUR 400 rent increase lowers that to EUR 900. That arithmetic may matter more to your decision than a small difference in effective tax.
Keep one-off costs separate. A EUR 6,000 move consumes six months of a EUR 1,000 monthly improvement. Save the scenario link alongside the offer date and a list of benefits that the calculator excludes.
- Confirm the salary is gross and the pay period is correct.
- Check the region and resident-employee assumptions for each destination.
- Separate recurring costs from deposits and relocation fees.
- Verify the final payroll estimate before accepting an offer.
Sources and further reading
These references support the framework and cautions in this guide. Tax outcomes remain jurisdiction- and fact-specific.