This Sun-Kissed European Country Offers a 50% Tax Break

…and a Pathway to an EU Passport

“How much did you really like Greece?” my wife asked me recently.

The way she phrased the question, the weirdly placed lilt in her voice, I knew there were some gears turning somewhere in her head. Greece was our first vacation together when we were dating, and we both felt at home there.

Turns out those gears have her thinking about maybe—maybe—relocating our family to Greece.

It’s certainly old news to tell you that Greece is beautiful. That the Aegean Sea is gorgeous. That Greek food and culture and hospitality are off the charts. But I’ll tell you anyway, as though it’s the latest and greatest news, because Greece is just that amazing.

But there’s another reason Greece is on our radar as a potential new home…

Inflation isn’t just attacking the U.S., it’s also pushing up prices here in Prague, where I live.

Our rent is up markedly. Utility costs are up markedly. Despite her best efforts, my wife can’t find a replacement apartment as nice as ours, in an equally desirable neighborhood, below our current costs.

And apparently, she’s read some of my columns, because in the midst of our conversation about Greece, she threw this out: “They have a digital nomad visa, so you can work there.”

She knows me well.

That’s the very first thought I have when it comes to my digitally nomadic life: Can I get a visa to live and work there?

I love traveling around, but I want a base of operations to call home. And for that, you need a visa.

This notion of a digital nomad visa has become the catnip of economic development globally. In our post-pandemic age that has increasing numbers of workers logging into jobs from anywhere they want to be, governments all over the world have begun introducing these visas to attract footloose professionals to their shores.

Most recently it was Italy, which has announced a new digital nomad visa that’s good for one year, but then infinitely renewable so long as one continues to meet the rules for obtaining one.

Not a bad way to live permanently in Europe.

Generally speaking, I’ve not been a fan of digital nomad visas. That’s because of the way most of them have been structured. They tend to be short-term documents that allow you to live locally for a while, but which you often can’t use to pursue permanent residence.

I mean, unless you truly want the itinerant life, the savvier approach is picking a country where you can obtain a temporary residence permit that then transitions into a long-term residence permit. That way, if you end up loving life in your year abroad, you can turn it into something more permanent, rather than having to leave and start over somewhere else.

With Greece, the initial visa lasts a year. If it turns out that after a year you love living along the Aegean, you can apply for a Digital Nomad Residence Permit that gives you another two years in-country. After that, you can continue to renew your residence permit for two-year increments.

Renew a few times and suddenly you’ve been in Greece for seven years and you can apply for Greek citizenship…which comes with a much-desired European Union passport that gives you unfettered access to living and working in any of the 27 EU member states.

The rules for obtaining a Greek digi-nomad visa aren’t terribly taxing. Aside from the usual suspects of documents evidencing your lack of criminal conviction, your possession of health insurance, and your non-EU nationality, all you really need is proof you earn at least €3,500 in monthly after-tax income (roughly $3,700).

Better yet, the Greek visa comes with a big tax break.

Greece, where tax evasion is an Olympic sport, will tax only 50% of your income for seven years, which coincides with the seven years needed to obtain Greek residency.

Granted, the Greek tax rate is 44% on any earnings over €40,000, but the 50% reduction basically means you’d be paying 22% on your overall income. Not horrible, and less than you’d pay in the U.S.

And keep in mind that because you’d be living and working in Greece, you’d be eligible for the U.S. Foreign Earned Income Exclusion, which in 2022 allows you to write off $112,000 from the personal taxes you’d owe to Uncle Sam. Plus, you’d collect housing credits that can save you hundreds more in U.S. taxes.

You’ll still owe self-employment taxes, assuming you’re working for yourself. Nevertheless, the tax exclusion in the U.S. and the hefty tax break in Greece make an Aegean lifestyle seem really compelling to me.

And to my wife.

She’s angling to get back to Greece on vacation. She wants to snoop around a bit, see what she likes.

We have a trip to Portugal coming up in July for the same purpose—to see what’s what in another seaside country where costs are low and access to a work visa is easy.

Seems like Greece might be our August destination.

I’ll let you know how it goes.