Tax-Free Allowances Every Expat Should Know About
From relocation deductions to foreign housing exclusions, these little-known tax breaks could save you thousands each year.
Most countries offer tax-free allowances and deductions that disproportionately benefit mobile international workers — yet the majority of expats either don't know about them or fail to claim them. Here is a compilation of the most valuable across key expat destinations.
Universal Allowances
Personal allowance / tax-free threshold: Almost every country exempts a portion of income from tax. The UK offers GBP 12,570, Germany EUR 11,604 (2025), and Spain EUR 5,550 base (higher with children). Knowing your destination's threshold helps you estimate take-home pay accurately.
Expat-Specific Breaks
- US Foreign Earned Income Exclusion: US citizens abroad can exclude up to USD 126,500 (2025) of foreign-earned income. Add the Foreign Housing Exclusion for another USD 18,000-37,000 depending on location
- Netherlands 30% Ruling: Up to 30% of salary tax-free in the first years
- Germany Double Household: Deduct second home costs when maintaining a home abroad
- France Inpatriate Regime: 50% exemption on the "inpatriate premium" portion of salary
- Belgium Expat Regime: Tax-free reimbursement of recurring costs of living abroad, up to EUR 29,750/year
Commonly Missed Deductions
Language courses required for work, international school fees (in some jurisdictions), cross-border travel for work purposes, tax advisor fees (deductible in Germany, Austria, and others), and cost of obtaining work permits and visas may all be deductible depending on your country of residence.
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