TAXES IN EUROPE
Working and living abroad is a great experience.
Before you choose it is good to know a little bit about the tax levels.
Working in Europe is easy to do and basically everybody should do this for at least one period. Of course agencies like Careers in Europe like to make this easier for you, but we also want for everybody to have good information to make the right choice. An item often overlooked is the level of employee taxes. A high salary sounds nice, but what if you pay a lot of taxes? Exactly, you could just as well work somewhere else with a lower salary and lower tax level.
In this article we look at taxes in Europe. We name all 28 countries and compare the tax level on a € 1000 fictional income. For more information about working abroad, find more interesting articles under Working in Europe and Living in Europe.
We look specifically at employee taxes. Employee taxes are taxes deducted by your employer from your gross salary. These taxes are contributions for sick leave, pension. Many countries also have contributions for the elderly, unemployment or people with disabilities. We will not look into how countries motivate these contributions, we just look at what is left after taxes are deducted.
For comparison we will use a fictional income of € 1000. Obviously in different countries you will receive different salaries for similar jobs. For our comparison this is not relevant.
(click % to open tax calculator)
|Net left||Consumer Price Index|
In these examples the percentages were taken from national tax calculators. Click on the percentage to open a new tab with the calculator for that country. Where we put an * it means this country does not have taxes for the amount € 1000/month. Basically in these countries lower incomes are exempt from tax. We advise you to insert your salary in the calculator to see what you would pay. In Belgium the government even gives you some money back 😉
This overview is a very basic overview to give you an idea. Many countries have progressive tax systems, where higher salaries pay more taxes over certain income amounts. Many countries have other employee obligations, eg. health insurance contributions can be mandatory outside the employee taxes.
The percentages we gathered from recent income statistics (2019). The percentages change every year, usually they go up. And then it is important to understand not all countries apply a correction on salary or consumer price index inflation correction. Percentages may be different from your own situation, see this overview as a basic indication.
Something else to understand is that we cannot and do not expressive any opinion on whether taxes are well spent in a country. This is up to residents to decide. If you want, you are welcome to share your opinion about your resident country.
Many countries apply tax relief or tax back. Tax relief and tax back is to relief people in specific difficult or lower income situations. Think of deductions for child care, disability, temporary work, job loss, etc, but also tax free sums. In this overview we did not include this data.
For the CPI the index is set to 100 on the 28-EU countries. The numbers for each country indicate how much the prices differentiate from this number. Your interpretation should be what prices you can expect in this country as compared to the EU average. In other words a country can have favorable tax levels, but high prices. In the end you would still not have a good situation.
The ideal situation is low taxes AND low prices. After all, taxes you pay once a month, groceries you need everyday.
This comparison does not say anything about the standard of living. As we can see from eg. the Happiness Index, people experience standard of living in a variety of ways. Think of possibilities for healthcare, safety, schooling, part time working and so on.
|Top 5 ‘Expensive Countries’||Top 5 ‘Cheap Countries’|
We see no real surprises in the top 5 expensive countries. People in these countries are happy to pay more taxes or higher prices in exchange for the quality of life they experience. The top 5 cheap countries is also predictable. In these countries people generally make less money with far less cost of living. In general people who work in lower paid jobs are better off working in cheaper countries.
We hope you enjoyed this overview. If you have questions or comments, just write us or use our Facebook to respond. We wish all a good choice and happy years abroad!