Exploring Tax-Free Living Options for British Expats
Over the past few years, the UAE and Saudi Arabia have become increasingly popular among British expats seeking a life in the sun, free from the burden of taxes. While this trend is not new, especially for the ultra-wealthy, more people are now being drawn to these regions by the promise of a better quality of life away from the cold and grey UK.
However, with ongoing conflicts across the Middle East and cities like Dubai, Abu Dhabi, and Riyadh facing waves of violence, many Brits are looking for alternative destinations that offer similar benefits without the risks. Some are turning to countries such as Portugal or Malta, while others are considering low-tax jurisdictions further afield, such as Barbados.
So, where can expats find a tax-free lifestyle with all the advantages of places like the UAE, but in a more under-the-radar setting and without the threat of ongoing violence? Here’s a list of some of the best options:
Bahamas
The Bahamas has long been considered an island paradise for the wealthy, offering numerous advantages when it comes to taxation. It has no income tax, making it a haven for foreign investors and retirees. Additionally, there’s a lack of capital gains tax, inheritance tax, or corporate tax. You can fly directly from London Heathrow to Nassau with British Airways, making it appealing given the ongoing crisis engulfing air spaces across the Middle East. This part of the world offers a luxurious environment with secluded pink-sand beaches, coral reefs, and superb sailing.
Privacy, security, and lifestyle make it a favorite destination for many North American billionaires. Start-ups, crypto, and fintech investors are also being drawn to its capital, Nassau. Around 4,100 Brits live there, many in Nassau on the island of New Providence, the expat hub with most of the international schools and cultural institutions.
According to cost-of-living site Numbeo, renting a one-bedroom apartment in the city center will cost you $1,195 (£895) per month, while average bills will set you back $285 (£213) each month. However, downsides include crime from time to time, with the FCDO warning about violent crimes and armed robberies in residential and tourist areas of New Providence and Grand Bahama. Cultural differences and conservative attitudes towards the LGBT+ community can also cause friction.
Bermuda
If you like the sound of the Caribbean, Bermuda could be the choice for you. Bermuda is the oldest self-governing British Overseas Territory and is popular among many Brits. Its big advantages include security, safety, and a high standard of living, plus the lack of income tax or capital gains tax.
You can visit Bermuda without a visa for up to 180 days in any 12-month period. To stay longer or work, study, travel for business, or other reasons, you must meet the Bermudian government’s entry requirements. If you want to work in Bermuda, you must get a job offer and work permit before entering the country. You must not look for work while visiting as a tourist.
However, Bermuda has high customs duties and a high cost of living. A three-bed apartment in Paget might cost $10,000 (£7,497) a month to rent – rent is 113.2% higher than in London, according to Numbeo.
Monaco
Billionaire’s paradise Monaco is next on the list. Adored by F1 stars, international businessmen, and many celebrities, it’s known for its lavish lifestyle and glamorous hotels. With high-end shopping, Michelin-starred restaurants, casinos, and beach clubs galore, it has more millionaires per square meter than anywhere else.
More than 2,800 British nationals officially reside in Monaco. The lack of income tax, wealth tax, and capital gains tax are big draws. When passing on assets, spouses and children do not pay inheritance or gift tax. However, the downside includes an extremely high cost of living, with many reporting exorbitant costs in the region.
Cayman Islands
With direct flights from Heathrow to Bermuda with British Airways, this British Overseas Territory offers a tax-free and beachside lifestyle. The region boasts a high standard of living coupled with a low crime rate and Caribbean climate. It’s also known for its fun, vibrant lifestyle, with boat parties galore revolving around Seven-Mile Beach and George Town, the biggest town and business hub of the Cayman Islands.
It also has tax advantages: no corporation, income, capital gains, or inheritance taxes. However, downsides include small-island mentality, few employment options, and high electricity and home insurance bills. Hurricanes are also a risk in the Cayman Islands.
Malta
Recently, a study analyzed the world’s most popular and up-and-coming digital nomad hotspots to unveil the top ten nations for Brits looking to relocate this year – and Malta made the top five. The EU base has English as an official language and a remittance tax system available to UK residents.
Malta’s tax residency scheme offers a flat 15% tax rate on foreign income remitted to Malta, with no local tax on overseas income kept outside of Malta. Capital gains made outside of Malta are exempt from tax, even if the proceeds are remitted to Malta. Malta’s capital city, Valletta, was also handed the coveted title of best city in the world at the Condé Nast Traveller Readers’ Choice Awards 2025.
The European hotspot is known for its Mediterranean sun, as well as fabulous architecture, great food, and impressive prices. It’s reasonably priced, too, as a beer in the city will only set you back around €2.12 (£1.85). However, overcrowding, intense traffic congestion, high rental costs, and heavy, year-round construction are among some of the bugbears of residents living in the country.
Cyprus
From this year, Cyprus offers a €22,000 (£19,061) annual tax-free income threshold for individuals, making it highly appealing to British expats. Coming in fifth in the ranking of the top 10 nations for Brits looking to relocate, here expats can enjoy a tax-free foreign income and a laid-back Mediterranean lifestyle – though limited public transport and a healthcare system less developed than the UK’s NHS may not appeal to some.
There are plenty of success stories of Brits who’ve made the move to the sunny nation. Last year, a British family who grew so fed up of dreary UK life and moved to Cyprus revealed how much happier they are with their new life. Sarah, 48, and James Moore, 47, relocated from Middlesbrough with their two children, nine-year-old Bea and Miles, five. Now, the family of four spend more time together and were ‘instantly happier’ soon after they relocated.
The cost of living in Cyprus has worked out in their favor. However, downsides of Cyprus include slow bureaucracy and extreme heat in the summer – not for everyone.
Georgia
For digital nomads seeking a more affordable lifestyle, Georgia offers visa-free stays for up to one year and a one percent tax rate for small businesses. According to research, Tbilisi outshines 69 other European cities for affordability, in line with combining low costs with an abundance of cultural and historical attractions.
In Tbilisi, a pint of local beer is just £1.64, while a three-course meal for two at a mid-range restaurant costs less than £33. There’s more to draw in expats outside of cheap prices, though. With diverse cuisine and cultural highlights, there’s plenty to explore in this up-and-coming destination.
It should be noted that outside of its capital, Tbilisi, language barriers and underdeveloped infrastructure in Georgia may pose some challenges for some. The FCDO advises against travel to certain parts of Georgia, so you should check if the region you plan to visit is safe.
Costa Rica
Costa Rica only requires a $3,000 (£2,233) monthly income for its Digital Nomad Visa and places tax exemptions on foreign income. You can fly to San Jose Juan Santamaria Airport via Madrid or Amsterdam, among other destinations.
There are plenty of advantages of life in Costa Rica. For one, the abundance of beautiful beaches, swimmable waters, excellent hiking, and mountains and waterfalls to visit make it an exceptional choice for fans of nature. Plus, temperatures range between 12-27°C, meaning you’d be avoiding cloudy Britain for sunnier climes.
However, the huge numbers of tourists can cause problems, and bad roads can make traveling around an issue. Also, the GOV.UK website warns: ‘Muggings and theft are significant problems, particularly on the Atlantic coast. You should be aware of who is around you when using ATMs, be vigilant on buses and keep your luggage in view if possible – thieves are likely to try and distract you. Watch wallets and valuables when on the beach.’
There have been incidents where thieves slash a tyre and then offer to help change it, while an accomplice steals from the car. In Costa Rica, you should avoid walking alone in poorly lit or remote areas at night. Plus, if you’re using a hire car, do not stop your car for strangers signaling for help – they could be carjackers.
Mauritius
Mauritius offers a one-year Premium Visa, tax-free offshore income, and a tropical setting. You can also fly via Paris or Amsterdam, avoiding popular layover hubs in the Middle East.
According to Tripadvisor: ‘Mauritius is a tropical paradise with tons to do and some of the most beautiful landscapes on the planet.’ Of course, this Indian Ocean island nation is known for its gorgeous beaches, waterfalls, lagoons, and mountain views.
Port Louis, the modern capital of this 38-mile by 29-mile island, is a bustling port with a revitalized waterfront and busy market. It’s worth a visit, but most visitors gravitate toward resort areas such as ritzy Mont Choisy, quiet Trou-aux-Biches, and the bustling Flic en Flac.
Downsides include a high cost of food, accommodation, and goods, and traffic and congestion can be severe. Plus, the FCDO warns: ‘Most crime is non-violent such as burglaries from tourist villas or theft of unattended bags. Petty crime is common, particularly in tourist areas such as Port Louis, Grand Baie and Flic en Flac. There have been some reports of sexual assaults on tourists.’
