If you want to be a digital nomad, you need to make sure your taxes are in perfect order. You don’t want to return home after a few years of traveling only to realize you ran into some truly massive problems with your home state. But at the same time, you are probably aware of the large amounts of money taxes can cost, especially if you need to pay them in two different countries. So which countries in Europe are the best when it comes to taxes for digital nomads?
Greece
Greece is one of the leading countries in digital nomad legislation. They legislated the lifestyle in early September 2021 and have since offered a 50% tax reduction on not just the income tax but the social security payments as well. This tax reduction applies to most remote workers in Greece so it’s not that difficult to use the advantage and enjoy one of the most beautiful and pleasant countries in Europe.
Malta
If Greece sounds great, wait until you hear about this place. Malta decided to launch the Nomad Residence Permit in 2021 which can be used for your stay for up to three years (though it must be renewed every year). This alone is great, but there’s more. In Malta, you only pay taxes on your local income. Any worldwide income is not taxed as long as it’s not sent to Malta. And when it comes to capital gains, there’s no taxation even if it is sent back to Malta.
But Malta's government didn’t stop there. It is one of the best places to start a business as a digital nomad because you can use subsidies and tax relief programs to essentially lower your taxes to about 5% of what they would otherwise be. Don’t let this opportunity pass you by and go to Malta as soon as you can.
Portugal
Portugal has long been a country that wants to lure digital nomads to its beautiful shores. The D7 Visa (or the Passive Income Visa) has been a great way for digital nomads to get into the country and enjoy their stay worry-free.
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Pair this together with the Non-Habitual Residence Tax which makes all your overseas income tax-exempt and you have yourself one hell of a deal. Part of the NHR tax has also been a zero tax on cryptocurrency gains, so there are a lot of options on how to finance your digital nomad journey in Portugal.
Cyprus
Lastly, no list of tax-friendly places for digital nomads would be complete without Cyprus. This small country offers a Digital Nomad Visa together with some truly amazing tax conditions. There is no taxation of overseas income, passive interest earnings, or any profit from selling securities overseas. These are some hard-to-top conditions when it comes to digital nomads and taxation. There’s no place like a small island in the Mediterranean to relax and enjoy your nomad experience.
