When sizing up your potential international school salary, one factor to consider is tax. In most countries, you can expect a fair chunk of your salary to go to the tax man before you see it.
Of course, the tax rate shouldn’t be the only factor you take into account when assessing your potential salary. The cost of living and the value of your benefits package will also influence how much you can save and what quality of life you can afford.
Make sure you fully understand how to assess the salary and benefits package you’ve been offered. It’s not as easy as converting the salary into your local currency!
However, having a tax-free salary certainly helps the equation, especially if you compare it to the 20-plus% you would pay at home. Here are some countries where it’s possible. Perhaps unsurprisingly, most of the tax-free countries are in the Middle East, but there are some other great destinations where you can pay little to no tax on your teachers’ salary.
Middle East
- Kuwait – There is no income tax in Kuwait, and “no other taxes of any consequence, such as sales or value added taxes, property taxes, etc”.
- Oman – In Oman, there is no income tax. Residents employed in the private sector pay 6.5% of their salary to social security.
- Qatar – In Qatar, there is no income tax or social security.
- Saudi Arabia – In Saudi Arabia, there is no income tax, and ex-pats are excluded from the Saudi social security system (meaning you needn’t pay into it, but you’re also not covered by it).
- United Arab Emirates – In the UAE, there is no income tax, although you will be taxed on goods and services.
Search the latest teaching jobs in the Middle East.
If the idea of teaching in the Middle East excites you, why not get the wheels in motion and create your profile page today (it’s free)?
Other destinations
- The Bahamas – For foreigners working in the Bahamas, there’s no income tax, although there are other forms of tax. National insurance is deducted at 3.4% of earnings.
- Bahrain – If you work in Bahrain, there is no income tax. All workers pay a small ‘social insurance’ tax, but at 1% of the total salary, it doesn’t break the bank.
- Brunei (in SE Asia) – There is no personal income tax in Brunei, although there are other forms of tax. There is a 5% deduction for the Employees Trust Fund, plus pension contributions.
Teacher Horizons work closely with Brunei and usually have a number of fantastic opportunities for teachers and teacher trainers with an excellent tax-free package – particularly suited to young families. You can read one teacher’s experience here or search the latest teaching jobs in Brunei here.
- Cayman Islands – There is no personal income tax in the Cayman Islands. Taxes are paid for goods and services.
Low tax
Lastly, in these countries, income tax is charged but is 10% of your salary or less, which we think is pretty low.
- Mongolia – In Mongolia, personal income tax is 10%.
- Paraguay – In Paraguay, you can expect 8-10% of your salary to be deducted.
Are you hoping to save as many of those precious pennies as possible whilst working internationally? Read our top tips on how to earn extra income and join the Teacher Horizons community for more great info for international teachers.
Sources: www.expatfocus.com,
https://taxsummaries.pwc.com/Paraguay/Individual/Taxes-on-personal-income
