Most developed countries that are attractive for immigration operate progressive tax systems, under which higher income levels are subject to higher tax rates. In Germany, France, Spain, and many other developed economies, effective tax rates for high-income individuals often range from 35% to 50%. In this article, we provide an overview of what we consider to be the most attractive European jurisdictions for establishing personal tax residency. These options are suitable for individuals who are prepared to spend less than six months per year in their country of origin and to relinquish their existing tax residency.
Bulgaria
Bulgaria applies a flat personal income tax rate of 10%, which is the lowest in the European Union. An additional advantage of Bulgaria is its relatively low cost of living compared to other EU countries.
United Kingdom
Strictly speaking, the United Kingdom is not a tax haven for British citizens, as it applies a progressive tax system with a top marginal rate of 40% and taxes worldwide income. However, it can be attractive for foreign nationals who relocate to the UK under certain immigration categories. Such individuals may qualify for non-domiciled status, under which only income earned in the UK and foreign income remitted to the UK is subject to taxation. Foreign income earned and retained outside the UK is not taxed. This regime is available for a limited period of four years, after which standard progressive taxation on worldwide income applies.
Cyprus
Cyprus applies a progressive income tax system with the following rates: income up to €22,000 per year is tax-exempt; income from €22,001 to €32,000 is taxed at 20%; from €32,001 to €42,000 at 25%; from €42,001 to €72,000 at 30%; and income exceeding €72,000 at 35%. Tax residency in Cyprus is generally established by spending at least 183 days per calendar year in the country. Residency is assessed annually and does not automatically create permanent tax residency.
Cyprus has become particularly attractive due to the introduction of the non-domiciled tax resident status. Individuals holding this status, whether foreign nationals or Cypriot citizens, are exempt from tax on dividends, interest, and rental income earned outside Cyprus, provided they have not been tax residents of Cyprus for at least 17 of the previous 20 years. This regime is available for up to 15 years, after which standard taxation applies.
Malta
Since 2013, Malta has operated a residence-by-investment scheme for tax purposes known as the Global Residence Scheme, designed for non-EU nationals. Applicants must purchase residential property in Malta with a minimum value of €275,000 or rent property for at least €9,600 per year. For properties located in Gozo or the southern regions of Malta, the minimum purchase price is €220,000 and the minimum annual rent is €8,750.
Under this scheme, applicants receive a residence permit without the right to work. Tax liability is capped at a flat annual amount of €15,000, applicable to both individual and family applications. There is no minimum physical presence requirement for annual renewal; however, Malta must be considered the applicant’s main place of residence, which in practice limits time spent in other countries to less than six months per year. This regime is conceptually similar to Switzerland’s lump-sum taxation system, but is significantly more affordable. Applicants are required to demonstrate proficiency in English, and an interview is conducted prior to issuance of the residence permit.
Monaco
High-net-worth individuals may obtain a residence permit in Monaco without the right to work in the Principality. Requirements include the purchase or rental of residential property, a bank account in Monaco with a minimum balance of €1,000,000, and valid health insurance. The application process involves obtaining an immigrant visa from a French consulate, followed by in-person submission of documents in Monaco.
Monaco has a very high cost of living but does not levy personal income tax or capital gains tax. To qualify as a tax resident and obtain a tax residency certificate, an individual must spend at least 183 days per year in Monaco.
Switzerland
Switzerland’s political and economic stability, high standard of living, developed infrastructure, and low crime rate make it a highly attractive destination. Switzerland is a confederation in which each canton sets its own tax rules, resulting in competition between cantons to attract wealthy residents.
While standard income taxation is progressive and can be relatively high, all cantons (except Zurich and few others) allow eligible foreign nationals to enter into lump-sum taxation agreements. Under such arrangements, the individual pays a fixed annual tax in exchange for residency, regardless of actual income. For non-EU nationals, minimum lump-sum amounts typically start at CHF 200,000–300,000 per year, depending on the canton. This regime is economically attractive only for individuals with very high annual incomes. Swiss citizenship may be obtained after 12 years of residence, but it is important to note that lump-sum taxation is not available to Swiss citizens and cannot be retained after naturalization.
Greece
Greece offers a flat tax regime under which foreign investors may pay €100,000 per year on foreign-source income, regardless of the amount earned. This regime is available for up to 15 years. Applicants must hold a Greek Golden Visa or invest at least €500,000 in Greek securities, shares, or company participations. Family members may be included by paying an additional €20,000 per person. Participation in the Golden Visa program requires a minimum real estate investment of €400,000.
Italy
Italy offers a special tax regime for individuals who have not been Italian tax residents for at least nine of the ten years preceding their relocation. Introduced in 2017, this regime is targeted at high-income individuals whose tax burden in their home country exceeds €300,000 annually. Eligible individuals may opt to pay a flat tax of €300,000 per year on foreign-source income instead of being subject to Italy’s progressive tax rates. Family members may be included for an additional €50,000 per person.
This flat tax replaces taxation on foreign income and capital gains and also provides relief from gift and inheritance taxes on foreign assets. Italian-source income remains subject to standard progressive taxation. The regime is available for a maximum period of 15 years, after which normal taxation applies.
The review was prepared by specialists from Elma Capital.
Read the second part of the review here: The Best Tax Havens - Part Two
Published January 13, 2026