What Countries Have The Lowest And Highest Income Tax?

If you want to move to a country to pay less income tax, you have a wider choice than just the Middle East.

The first zero-tax countries that come to mind are the Gulf States – especially the United Arab Emirates, Kuwait, Qatar and Saudi Arabia.

But one of the world’s best-kept financial secrets is another nine countries charge no taxes, while nine more have a personal tax rate between 7 and 10 per cent.

Find out more below.

Most other zero-tax nations are in the Caribbean – Anguilla, Antigua and Barbuda, Barbados, Bermuda, the Cayman Islands, and St Kitts & Nevis.

The remaining no tax zone is the island of Brunei in the Asia Pacific.

If you are looking for a tax rate of less than 10 per cent, only two countries come into the equation – Central America’s Guatemala (7 per cent) and Europe’s Montenegro (9 per cent).

A cluster of countries nestles at 10 per cent income tax, including Bosnia-Herzegovina, Serbia, Bulgaria, Macedonia and Romania in Eastern Europe.

Bulgaria and Romania are also European Union members, but the bad news for expats is they remain outside the Schengen Area of visa-free travel across Europe.

Zero and low tax countries

The table shows the countries with the world’s lowest personal income tax rates and how the rates have changed over the past five years:

Country	2017	2018	2019	2020	2021
Anguilla	0	0	0	0	0
Antigua and Barbuda	25	25	0	0	0
Bahamas	0	0	0	0	0
Bahrain	0	0	0	0	0
Bermuda	0	0	0	0	0
Brunei Darussalam	0	0	0	0	0
Cayman Islands	0	0	0	0	0
Kuwait	0	0	0	0	0
Oman	0	0	0	0	0
Qatar	0	0	0	0	0
Saint Kitts and Nevis	–	–	0	0	0
Saudi Arabia	0	0	0	0	0
United Arab Emirates	0	0	0	0	0
Guatemala	7	7	7	7	7
Montenegro	9	9	9	9	9
Bosnia and Herzegovina	10	10	10	10	10
Bulgaria	10	10	10	10	10
Kazakhstan	10	10	10	10	10
Macedonia	10	10	10	10	10
Mongolia	10	10	10	10	10
Romania	16	10	10	10	10
Serbia	15	10	10	10	10

Countries with the highest tax rates

Finland is the country with the highest personal tax rate – hitting a maximum of 56.95 per cent.

A whisker behind is another Scandanavia nation – Denmark, with an income tax rate of 56.5 per cent, which beats the  55.97 per cent top tax rate of 55.97 per cent.

Slightly under one in four of the 152 countries analysed by PWC Worldwide Tax Summaries charge personal tax at 40 per cent or more.

The UK slots into the listings with the additional tax rate of 45 per cent.

Some countries, like Portugal, have special tax rates for expats going to the country on a golden visa or passport.

Retirees in Portugal can agree to invest in property, while in return pay little or no income tax for up to 10 years, for instance.

Country	2017	2018	2019	2020	2021
Finland	54	53.75	53.75	56.95	56.95
Denmark	55.79	55.85	55.89	55.89	56.5
Japan	55.95	55.95	55.95	55.95	55.97
Austria	55	55	55	55	55
Sweden	57.12	57.34	57.19	32.28	52.85
Aruba	58.95	59	52	52	52
Belgium	50	50	50	50	50
Israel	50	50	50	50	50
Slovenia	50	50	50	50	50
Netherlands	52	51.95	51.75	49.5	49.5
Ireland	48	48	48	48	48
Portugal	48	48	48	48	48
Sint Maarten (Dutch part)	47.5	48	48	48	48
St Maarten	47.5	48	48	48	48
Spain	45	45	45	45	47
Curacao	46.5	47	46.5	46.5	46.5
Iceland	46.24	46.24	46.24	46.24	46.25
Luxembourg	48.78	45.78	45.78	45.78	45.78
Australia	45	45	45	45	45
China	45	45	45	45	45
France	49	49	45	45	45
Germany	45	45	45	45	45
Korea, Republic of	40	42	42	42	45
South Africa	45	45	45	45	45
United Kingdom	45	45	45	45	45
Greece	45	45	45	44	44
Italy	43	43	43	43	43
India	35.54	35.88	35.88	42.74	42.74
Papua New Guinea	42	42	42	42	42
Chile	35	35	35	40	40
Congo	30	30	30	0	40
Congo (the Democratic Republic of the)	40	40	40	40	40
Mauritania	40	40	40	40	40
Senegal	40	40	40	40	40
Switzerland	40	40	40	40	40
Taiwan	45	40	40	40	40
Turkey	35	35	35	40	40
Uganda	40	40	30	40	40
Zimbabwe	51.5	51.5	45	40	40

Expats flock to high tax countries

Expats fleeing offshore to low tax countries is a myth.

Below, Money International has looked up the income tax rates of the top 10 overseas destinations for British expats – and all of them have a rate of 33 per cent or more.

Country	Expat population	Income tax rate	Tax ranking
Australia	1,300,000	45%	19
Spain	761,000	47%	15
United States	678,000	37%	46
Canada	603,000	33%	63
Ireland	291,000	48%	11
New Zealand	215,000	33%	64
South Africa	212,000	45%	24
France	200,000	45%	21
Germany	115,000	45%	22
Portugal	60,000	48%	12

What are the income tax rates in the UK?

The current British tax rates are:

Band	Taxable income	Tax rate
Personal Allowance	Up to £12,570	0%
Basic rate	£12,571 to £50,270	20%
Higher rate	£50,271 to £150,000	40%
Additional rate	over £150,000	45%

Income tax rates are different if you live in Scotland

Country Tax FAQ

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