What to consider before relocating abroad

The success of your relocation abroad is linked to many factors before, during and even after you expatriation.

Let’s begin by evaluating, well in advance, the most relevant aspects to consider before embarking on the complex path that is relocating to another country.

When planning a relocation, it’s essential to consider the characteristics of the countries you want to relocate to and what the consequences of your relocation will be with respect to what you’ll be leaving behind in your home country.

Planning your relocation

Where to relocate

If you are thinking of relocating abroad, the first thing to do is to identify what your reasons for taking this path are and to rank the elements that are crucial to you. Based on this ranking, you can begin to envision what the most attractive destination for you might be, i.e., where to relocate to live your new life according to your expectations.

How to relocate

Most of the countries that offer attractive tax incentives for retirees or entrepreneurs provide a bureaucratic process that you need to understand in detail in order to obtain tax residency and consequently the possibility to take advantage of specific tax incentives. This applies only if your home country and your destination country have signed a double taxation avoidance agreement.

You could research all this yourself and consider relocating on your own, keeping in mind the time and energy that this choice may entail: finding and signing a long-term lease agreement, interacting with foreign entities in the local language, producing the documentation required by those entities, and following the procedures in accordance with the foreign state’s time frames and procedures and coordinating them with your home country’s regulations regarding the transfer of your local registration and tax residency.

Or you can rely on a company experienced in relocations abroad, carefully checking the credentials of the company you are relying on (with a business name, and a recognizable and real structure), what guarantees it can offer you, what experience and expertise it has (theoretical and practical), and what certifications it holds.

When to relocate

Timelines related to obtaining tax residence abroad are critical, both from the perspective of your home country and from the perspective of the foreign country.

In regards to your home country, you will need to check whether you must actually reside outside the country for a minimum number of days each year in order to be considered a true tax resident abroad.

For this reason, it’s best to start the relocation process within the appropriate time frame for obtaining tax residence.

In terms of the foreign country you are relocating to, it is essential to check the required timelines as defined by local legislation and the lead time required for making appointments at the various public bodies where you need to go in order to receive your paperwork and documents.

An error in calculating the timing for your relocation can cost you dearly. For example, in some cases it may not be possible to apply for a tax-exempt pension, so you will have to wait until the following fiscal year to submit a new application.

What to consider when choosing a new country of residence

To confidently identify your ideal destination, you will need to consider several determining factors as they become part of your new daily life.

The 10 elements to consider before relocating abroad:

1. Taxes

If you are a retiree, how much are your benefits taxed in the country you want to relocate to? Do reduced tax rates apply only to private pensions or also public pensions? Is the tax rate fixed or are there also tax deductions?

Or, if relocating as an entrepreneur: how much is the tax rate for corporations (sole proprietorships/limited liability companies/joint stock companies)? What is the tax rate on profits? What are the expenses that have to paid when starting a new business locally or transferring a business to this country? Will I have to make social security contributions? How much will an employee cost me?

In some cases, professional insight into pure tax issues is needed: contact us to schedule an appointment with our tax specialists!

2. Cost of living

Some destinations are particularly advantageous not only because of preferential taxation but also because of the much lower cost of living than in your home country.

These two elements combined may make it possible to save more than you originally imagined.

3. Rental prices

To obtain and maintain tax residence, in most jurisdictions, it is necessary to sign a long-term lease agreement. The price of rent then becomes a determining criterion in choosing a country to relocate to.

Some nations are particularly affordable in this respect, such as Slovakia (where it is also possible to sign a hosting agreement), Albania, or Tunisia.

4. Health insurance

Some destinations require private health insurance, though each case is unique (e.g., an EU citizen, such as an Italian citizen, can take advantage of free public healthcare if he or she relocates to another EU country).

The cost of private health insurance differs greatly from one country to another, and it is essential to inquire about this factor well in advance.

5. Bank accounts

In order to transfer your residence to a foreign country, as a general rule you need to open a checking account with a local bank. If you have special financial needs, it’s important to know which banks are present in the specific country and city you have chosen for your relocation.

6. Types of rental houses

Real estate markets differ greatly from country to country and often even from city to city within the same country. It is important to have realistic expectations and to understand that the availability and type of long-term rental housing is subject to local market conditions.

In some countries it is quite easy to find homes for rent, but in others long-term rentals are very limited.

Take a moment to define the type of home you are looking for, the budget you have available, the features that are essential to you, and then contact us: we will explain in detail what can be found in your chosen destination and at what price.

Please note: if you have a pet , finding a rental home is generally more difficult. Relocating your dog, cat or other pet also requires the proper paperwork and planning.

7. Transfer of vehicles

If you also want to bring your car, motorcycle, or other vehicle with you, remember that each country has its own rules and procedures , and that there will be strict rules to comply with, including re-registration (with a change of license plate) in the country where you become a resident.

This process requires gathering and obtaining all the paperwork and documents related to your vehicle and, obviously, an additional cost.

8. Investment for relocation

In planning your relocation abroad, one question is absolutely key: how much do you need to invest to make it happen?

Keep in mind that if you decide to use an experienced relocation services company, there will be costs related to professional assistance and the responsibility involved in managing your individual case.

The calculation should take into account:

1. • a real estate trip to search for, select and visit properties available for long-term lease;
   • a deposit and annual rent;
   • any costs of translation and apostilization of documents;
   • expenses for health insurance policies;
   • relocation assistance fees for transfer of tax residency to be paid to the relocation company;
   • the cost of transferring your vehicle(s).

Contact us to make an appointment: our prices are provided by personalized estimate.

9. Moving

You may want to bring your furniture or special items with you: moving can be done in different ways and at different costs. It all depends on how many items you have, what they are, how big they are, and the distance to the chosen location.

10. Other items

When determining your reasons for relocating abroad, remember to carefully consider these additional factors: climate, language(s) spoken, general culture, presence of a community from your home country, safety, average utility costs, and the presence of schools/universities/daycare centers.

The professionals at REFRAMED are available to explore these issues in depth before your relocation.

Contact us to book your pre-relocation consultation!