Best Low Tax Countries for UK Expats in 2026

If you're planning a move abroad, a low tax destination is hard to ignore. Leave the UK properly and you can be taxed far more lightly elsewhere, through no income tax at all, a territorial system, or a regime designed to attract new arrivals.

But the best result depends on two things working together: choosing the right country, and making sure you actually leave the UK tax system. If you stay UK resident, a low tax move may not deliver anything at all.

This guide compares the leading low tax destinations for 2026, how each one works, who it suits, and the UK rules that decide whether the move pays off.

What makes a country low tax for expats?

Is a zero headline rate all that matters? No. For someone moving from the UK, low tax destinations fall into three groups, and each works in a different way.

Image 1 — the three kinds of regime

• No personal income tax: countries such as the UAE and Monaco don't tax individuals' income or gains at all.

• Territorial systems: countries such as Panama, Costa Rica and Georgia only tax income that arises locally, so foreign income is outside the net.

• Arrival regimes: countries such as Italy, Portugal and New Zealand tax residents on worldwide income normally, but give new arrivals a period of relief on foreign income.

Each suits a different profile. A salaried employee, a retiree living on UK pensions and an investor living on dividends can each get the best result in a different country.

Low tax countries for UK expats in 2026: regime type, headline tax and UK treaty

🇦🇪 United Arab Emirates

Why is the UAE top of so many lists? The UAE has no personal income tax, no capital gains tax and no inheritance tax for individuals. Public spending is funded through VAT, corporate tax and customs duties.

Residence is relatively easy to obtain through employment, a free zone company, property investment or the Golden Visa. For tax purposes you're generally UAE resident with 183 days there in a 12-month period, or 90 days if you also hold a residence permit and a permanent home or job there. That lets you apply for a tax residency certificate, which matters because the UK–UAE treaty gives you a tie-breaker if both countries claim you.

One regional change to note: neighbouring Oman will introduce a 5% income tax on residents earning over OMR 42,000 a year from 1 January 2028, the first in the Gulf.

👉 UAE Ministry of Finance

🇸🇬 Singapore

What if you want low tax and a major financial centre? Singapore taxes individuals on income earned in Singapore at progressive rates up to 24%, while foreign-sourced income received by individuals is generally exempt. There's no capital gains tax and no wealth tax.

It suits professionals relocating with an employer and investors with income from elsewhere. Residence usually follows an employment pass or an investor route, rather than being something you can simply choose.

👉 IRAS: individual income tax in Singapore

🇵🇦 Panama

Panama taxes only Panamanian-source income, so foreign earnings, pensions and investment income are outside its tax net. A low cost of living makes it popular with remote earners and retirees.

Residence routes such as the Friendly Nations visa have tightened in recent years, so check the current conditions before relying on one. The UK–Panama treaty helps if the UK still claims you.

👉 Panama tax authority (DGI)

🇨🇷 Costa Rica

Costa Rica also uses a territorial system, and holders of its digital nomad visa are exempt from local income tax on their foreign earnings. That makes it an obvious option for remote workers on a one or two-year horizon.

Two cautions. A bill before the Legislative Assembly would tax certain foreign passive income, such as dividends, interest and rent, at 15%. And there's no UK–Costa Rica treaty, so there's no tie-breaker if the UK still treats you as resident.

👉 Costa Rica Ministry of Finance (Hacienda)

🇬🇪 Georgia

Why does Georgia keep coming up? Foreign-sourced income of individuals is generally exempt, and qualifying individual entrepreneurs with small business status pay 1% on turnover up to GEL 500,000 a year. Employment income is taxed at a flat 20%.

The 1% applies to business turnover under a specific regime, not to personal income generally, so it suits lean service businesses such as freelancers and consultants rather than everyone.

👉 Revenue Service of Georgia

🇮🇹 Italy

What about Europe? Italy's regime for new residents replaces Italian tax on all foreign income with a fixed annual payment. For people moving in from 1 January 2026 it's €300,000 a year, plus €50,000 for each family member included, for up to 15 years. Italian-source income is taxed normally.

It only makes sense for very high incomes, but for them it offers certainty. You must not have been Italian resident for at least nine of the previous ten years.

👉 Agenzia delle Entrate (Italy)

🇵🇹 Portugal

Is Portugal's old NHR regime still available? Not to new arrivals. Its replacement, IFICI, gives a 20% flat rate on qualifying employment and self-employment income for ten years, with most foreign income exempt. It's aimed at specific professions, including research, technology and start-up roles, and foreign pensions don't qualify.

See our guide to moving to Portugal from the UK.

👉 Portal das Finanças (Portugal)

🇳🇿 New Zealand

New Zealand gives new arrivals, and New Zealanders returning after ten years away, four years as a "transitional resident". Most foreign income, including foreign investment income, rent and pensions, is exempt during that time.

The key exception is work. Foreign employment income and income from services performed while you're a transitional resident stay taxable, so it suits retirees and investors more than remote workers. You only get the exemption once, and there's no general capital gains tax.

👉 Inland Revenue (NZ): transitional resident rules

🇦🇺 Australia

Moving on a skilled visa? Australia treats most people on temporary visas as temporary residents, who generally don't pay Australian tax on foreign income or on gains on non-Australian assets.

As in New Zealand, work is the exception: income from employment or services performed overseas while you're a temporary resident can still be taxed in Australia. The regime lasts as long as your visa status, which makes it well suited to medium-term assignments.

👉 ATO: foreign and temporary resident income

🇬🇧 The UK itself, for new arrivals

Moving to the UK rather than away? New residents who haven't been UK resident in any of the previous ten tax years can use the 4-year FIG regime. It exempts foreign income and gains from UK tax for four years, whether or not the money is brought into the UK.

Claiming costs you your personal allowance and capital gains annual exempt amount for that year, and the income still has to be reported. On modest foreign income, paying tax normally can work out cheaper, so run the numbers both ways.

👉 HMRC helpsheet: HS266 foreign income and gains regime

Leaving the UK properly matters more than arriving

Is moving to a low tax country enough on its own? Rarely. The UK decides your UK residence under its own rules, whatever your new country says, and several UK charges can follow you out.

Image 2 — leaving the UK properly

• Break UK residence: the Statutory Residence Test looks at your UK days, ties and work. Fewer than 183 days isn't enough on its own. See Statutory Residence Test 101.

• Claim the split year: it's what stops the UK taxing your foreign income for the rest of the year you leave. See split-year treatment.

• UK income stays taxable: UK rent, UK workdays and UK property gains are taxed by the UK wherever you live, and so are UK pensions unless a treaty says otherwise.

• The five-year rule: come back within five years and gains, close company dividends and pension withdrawals taken while away can be taxed on your return. See temporary non-residence.

• The inheritance tax tail: long-term UK residents stay within UK inheritance tax for between three and ten years after leaving.

• Treaty or no treaty: becoming resident in a treaty country gives you a tie-breaker if both countries claim you. Monaco and Costa Rica have no UK treaty.

👉 HMRC guidance: RDR3 Statutory Residence Test
👉 GOV.UK: UK tax treaties by country

Frequently asked questions

Which countries have no personal income tax?

The UAE, Monaco (for residents who aren't French nationals), the Bahamas, the Cayman Islands, Qatar and Bahrain are among the best-known. Oman will introduce a 5% tax on residents earning over OMR 42,000 from 2028.

What is a territorial tax system?

A system that only taxes income arising in that country. Panama, Costa Rica and Georgia tax individuals this way, so foreign income such as overseas pensions or dividends is generally outside the local tax net.

Do I still pay UK tax if I move to a tax-free country?

You still pay UK tax on UK-source income, such as UK rent and UK workdays, and on UK pensions unless a treaty says otherwise. You also need to break UK residence under the Statutory Residence Test, and the five-year temporary non-residence rules can apply if you return.

Is Portugal's NHR regime still available?

Not to new arrivals. It has been replaced by IFICI, which gives a 20% flat rate on qualifying work income for ten years with most foreign income exempt, but only for specific professions. Foreign pensions don't qualify.

How long does New Zealand's foreign income exemption last?

Four years, for new arrivals and New Zealanders returning after at least ten years away. It covers most foreign investment income but not foreign employment income, and you can only use it once.