This is a short story of my personal experience of moving to different countries in the EU, seen through a legal lens.

My wife, who is a scientist, advanced her career through different international scholarships for post-doctorate projects, and our family (myself and our two young children) followed her on this journey. This experience gave us firsthand insight into the workings of the EU rights and obligations, as we became EU migrants

While the EU strives to unify regulations, every country is very different in its own right. Not just the culture but also some legal rules vary significantly from country to country. When planning to move, you must take into account the specifics of the country you are relocating to. Our adventure began when we moved from our home in Slovenia to Bayreuth, Germany, for one year. The following year, we moved to Scotland, which turned out to be a different experience than Germany, but I consider living in both countries as the best years of my life so far. We spent two years in Scotland and I fell in love with the country and its people. But that story is for another time and place. In this particular story, I want to touch upon some tax aspects of moving to different EU countries.

When you migrate solo, it can still be challenging, but you can afford to make some mistakes or forget certain things. You will probably be able to take care of the essentials, even if you wing it a bit. However, winging it with two kids in tow is highly inadvisable. Lack of preparation and planning when uprooting a whole family can lead to a wrecking experience, especially concerning family finances, which provide bread and a roof over your heads. And nothing influences the family’s finances as much as taxes. Getting a hang on gross and net amounts, tax credits and prepayments, tax residency, and avoiding double residency or double taxation might seem like a headache you wish to avoid, but is highly important not to overlook these aspects. So, this post aims to provide some non-expert advice on what you should consider regarding taxes before deciding to move from one country to another. Perhaps the following paragraphs will give you some ideas, and food for thought, enhance your “to-do list,” and ease your mind. Or, you could just skip all of this and jump headfirst into the murky waters of international migration

First lesson: You cannot avoid taxes

Remember the famous proverb: “DEATH and TAXES are the two things that are certain and unavoidable.” We have friends who ignored this chapter of moving and regretted it afterward.

In one case, the Slovenian tax administration started a procedure to determine the tax obligations for the previous five years. By that time, my friend had completely forgotten about his life in Slovenia. We managed to deal with the situation because all he had done wrong was failing to cancel his residence, although he had relocated all his social and economic interests. However, it could have turned out much less favorably. As a tax lawyer, the most general advice that I can give is: “Consider all income taxable. Do not assume that it isn’t.” Avoid illusions that your specific income is not taxable without making sure with the competent authorities that it actually isn’t. Modern tax systems in developed countries, including all EU countries, have robust international information exchange in place. In layman’s terms, you most likely cannot hide your income, so it’s best to declare it.

When applying for work abroad, take into account the country’s tax system and how gross and net income are calculated. Net income is simply the money that will be available to you after taxes. With that money, you will have to cover all living expenses, including treats like cinema tickets for the kids with some popcorn. A high gross amount does not guarantee financial security if the net income is low or if the living costs significantly exceed what you are used to. For instance, a 3,000 EUR gross salary in Slovenia, which translates to ca 1,800 EUR net, is a relatively high salary, partly because living costs in Slovenia are comparatively low for an EU country. However, a similar gross salary in Germany, despite its sometimes-beneficial family tax system, could prove to be much less than you need to support a family due to higher living costs

For example, when my wife received the Humboldt Scholarship during our time in Germany, it was our only income in that country. I insisted that we check multiple times with various sources that the scholarship was indeed not taxed in Germany. But even if you make sure how your income is taxed (or not taxed) in the country where you work, you must also address your tax status in your home (origin) country. In our case, the Humboldt Scholarship would have been taxed in Slovenia if we had not properly managed our tax residency status there

End of PART 1, lookout fot PART 2!

Disclaimer: The views expressed in this post are not the organization's official positions where the author is employed.