Tax Haven Relocation

Have you ever considered taking a short-term job opportunity abroad? With the housing market becoming increasingly competitive and expensive, saving for a deposit has become a tougher challenge for many potential buyers.

Taking up short-term opportunities abroad in countries like the USA, where tax treaties can help reduce rates for international employees, can be an effective strategy to save for a home deposit.

To determine which countries have the best opportunities to accumulate substantial savings while working abroad, we analysed the average house prices across UK local authorities. We estimated how long the average Brit would take to save a 10% deposit after working in each country for one, two, or five years. We also highlight how many years it would take to save a 10% deposit for a house in each UK region and which country would get you the fastest savings. 

Norway offers the fastest way to save for a UK house deposit

This table highlights the top countries where individuals can maximize their yearly savings. It includes details like average take-home salary, rent costs, living expenses, and potential yearly savings, along with how much could be saved over one, two, or five years.

		Monthly				Maximum potential yearly savings
Rank	Country	Average take-home salary	Average one-bedroom apartment rent	Single-person estimated costs	Maximum potential savings	One	Two	Five
1	Norway	£3,697	£681	£924	£2,092	£25,099	£50,199	£125,497
2	Denmark	£3,539	£712	£925	£1,903	£22,837	£45,673	£114,183
3	Switzerland	£4,160	£1,235	£1,312	£1,614	£19,366	£38,731	£96,828
4	Australia	£3,099	£891	£837	£1,371	£16,452	£32,903	£82,258
5	Luxembourg	£3,281	£1,181	£829	£1,271	£15,251	£30,502	£76,255
6	South Korea	£2,306	£274	£812	£1,221	£14,646	£29,293	£73,232
7	Austria	£2,698	£597	£902	£1,199	£14,382	£28,765	£71,912
8	Netherlands	£2,891	£951	£835	£1,106	£13,267	£26,534	£66,334
9	Canada	£2,841	£934	£804	£1,102	£13,229	£26,457	£66,143
10	United States	£3,205	£1,216	£981	£1,008	£12,092	£24,184	£60,461

This table outlines how much progress you could make toward affording a 10% deposit in the UK after working in each country for one, two, or five years. The figures show the percentage of UK local authorities where you could afford the deposit in the given time frame.

		% of UK local authorities you could afford a 10% house deposit
Rank	Country	After one year	After two years	After five years
1	Norway	42.38%	91.73%	100.00%
2	Denmark	32.04%	86.05%	99.74%
3	Switzerland	16.80%	78.04%	99.48%
4	Australia	6.46%	63.82%	99.48%
5	Luxembourg	4.65%	56.59%	98.97%
6	South Korea	4.13%	52.20%	98.45%
7	Austria	4.13%	50.90%	98.45%
8	Netherlands	1.29%	45.74%	97.93%
9	Canada	1.29%	45.74%	97.93%
10	United States	0.26%	38.24%	97.67%

1. Norway

Norway is the best country to temporarily relocate to if you want to save for a house in the UK. With an average monthly take-home salary of £3,697 and living costs of £1,605, you could put away around £2,092 each month. 

A year in Norway could allow you to save enough money to afford a house deposit in over two-fifths (42%) of UK local authorities. Saving for five years means you could’ve saved enough to live in any local authority.
What’s more, the UK has a double taxation agreement with Norway, which means you do not pay tax on the same salary for each country¹. Instead, you would just pay income tax to the Norwegian government.

2. Denmark

In Denmark, the annual savings potential sits at £22,837 for Brits working there. This means that after two years of maximum saving, you could afford a house deposit in almost nine in 10 (86%) UK local authorities. 

This works out better than staying in the UK to save. After the same number of years of saving as in Denmark, you may only be able to build up enough to put down a deposit in a third of local authorities. 

If you’re not quite looking to save the total amount of a house deposit but just save as much as you can in a short period, why not try out six months? For those staying in Denmark for less than 183 days and working for a Danish company, your income could be untaxed². However, although the UK has a double taxation agreement with Denmark, you may still be liable to pay income tax on short-term work, so you should always get professional advice on paying tax. 

3. Switzerland

While Switzerland has one of the world’s highest living costs, at approximately £2,546 for a single person each month, the average take-home pay is high too. With a potential annual saving of £19,366, you could afford a house deposit in 65 local authorities around the UK after just one year.

Federal taxes are in place for all Swiss residents (you’re considered a resident if you work there for longer than 30 days³), and the maximum rate is 11.5%. 

However, it is important to note that although there generally aren’t any direct penalties upon returning to the UK, there may be some implications involved. Some considerations to keep in mind include mortgage eligibility, taxes, and residency. This may require showing proof of income and credit history. Additionally, you may be required to pay taxes both on your UK income and any foreign income outside the UK.⁴

The difference becomes even more pronounced when looking at more expensive regions, such as London and the South East, where the average house prices range from £384,804 to £531,212. Saving in the UK for a London property deposit requires four years and seven months, the longest duration across all regions. In contrast, saving in Australia requires only three years and three months. This is similar to the South East, where UK-based saving requires three years and four months, while South Korea and Austria reduce this timeframe to two years and eight months.

Countries like the United States and Canada will have much longer saving periods for a 10% deposit. In the US, for instance, it would take just over two years to save for a house in the East Midlands and over three years for a South East deposit both countries still offer quicker saving times than the UK.  

However, taxation can impact savings, as the UK offers tools like ISAs with tax-free interest to aid first-time buyers. In Canada, accounts such as the FHSA (First Home Savings Account), and in the US, programs like IRAs (Individual Retirement Account) also provide tax benefits to boost savings​. Therefore, it is important to check the eligibility criteria in these countries to benefit from these accounts while also growing your savings.

	Number of years to save for a 10% house deposit in UK areas
	Norway	Denmark	Switzerland	Australia	Luxembourg	South Korea	Austria	Netherlands	Canada	United States	United Kingdom
North East	0y 8m	0y 9m	0y 10m	1y 0m	1y 1m	1y 2m	1y 2m	1y 3m	1y 3m	1y 4m	1y 5m
Northern Ireland	0y 9m	0y 10m	0y 11m	1y 1m	1y 3m	1y 3m	1y 3m	1y 5m	1y 5m	1y 6m	1y 7m
Scotland	0y 10m	0y 11m	1y 0m	1y 3m	1y 4m	1y 4m	1y 5m	1y 6m	1y 6m	1y 8m	1y 9m
Yorkshire and The Humber	0y 10m	0y 12m	1y 2m	1y 4m	1y 5m	1y 6m	1y 6m	1y 8m	1y 8m	1y 10m	1y 11m
Wales	0y 11m	0y 12m	1y 2m	1y 4m	1y 6m	1y 6m	1y 7m	1y 8m	1y 8m	1y 10m	1y 11m
North West	0y 11m	0y 12m	1y 2m	1y 4m	1y 6m	1y 6m	1y 7m	1y 8m	1y 8m	1y 10m	1y 11m
East Midlands	0y 12m	1y 1m	1y 4m	1y 6m	1y 8m	1y 9m	1y 9m	1y 11m	1y 11m	2y 1m	2y 2m
West Midlands	1y 0m	1y 1m	1y 4m	1y 7m	1y 8m	1y 9m	1y 9m	1y 11m	1y 11m	2y 1m	2y 3m
South West	1y 3m	1y 5m	1y 8m	1y 11m	2y 1m	2y 2m	2y 3m	2y 5m	2y 5m	2y 8m	2y 9m
East of England	1y 4m	1y 6m	1y 9m	2y 1m	2y 3m	2y 4m	2y 5m	2y 7m	2y 7m	2y 10m	2y 12m
South East	1y 6m	1y 8m	1y 12m	2y 4m	2y 6m	2y 8m	2y 8m	2y 11m	2y 11m	3y 2m	3y 4m
London	2y 1m	2y 4m	2y 9m	3y 3m	3y 6m	3y 8m	3y 8m	4y 0m	4y 0m	4y 5m	4y 7m

Things to keep in mind when living and working abroad

If you’re looking to temporarily move abroad to save for a UK house deposit, there are a few key factors to consider before taking the leap. 

1. Taxes

First, research tax implications in both your destination country and the UK. Many countries offer attractive tax-free allowances or reduced tax rates for expats, but they often require you to be a resident for a certain period (12 months in some places) to qualify. Additionally, if you’re still earning income from UK-based sources while abroad, you may be liable for UK taxes on that income, so it’s important to check the HMRC guidelines and consider consulting a tax advisor before moving abroad.

2. Relocation Costs

Relocation costs are another crucial consideration. Moving abroad can be expensive, especially if you’re shipping belongings internationally. Partnering with a reliable, experienced international removal company can help avoid unexpected fees and reduce the risk of damage or loss. Also, factor in temporary housing, visa fees, and possibly even language courses to help settle in.

3. Job Market

It’s also wise to research the job market and typical wages in your chosen country, as some sectors may pay more or offer better opportunities than others, particularly for English speakers.

Finally, make a plan for returning to the UK, including considerations for re-establishing credit or securing employment. This will help ensure a smooth transition when you’re ready to purchase your home.

Methodology

To determine the top countries with the best short-term savings opportunities for a house deposit, we looked at the average 2023 salaries of OECD countries. These figures were originally in USD. We converted them to each country’s currency on 01/11/2024 using Google Finance. 

Using each country’s currency, we input the average salaries into a Salary Tax Calculator to determine the average monthly take-home salary. We then used Numbeo to calculate the monthly cost of living, looking at the price of a one-bedroom apartment located outside the city centre to avoid inflated costs and also the estimated monthly costs of a single person. These figures were then subtracted from the average monthly take-home salary to determine the potential savings. 

To find average house prices by local authority, region/country, and the UK overall, we calculated the years required to save a 10% deposit using the UK House Price Index (August 2024). Using this data, we also calculated the % of local authorities you could afford to buy a house in after working in each country for 1, 2 or 5 years.

Sources

¹ https://www.gov.uk/guidance/living-in-norway 

² https://taxsummaries.pwc.com/denmark/individual/taxes-on-personal-income 

³ https://www.expat.hsbc.com/expat-explorer/expat-guides/switzerland/tax-in-switzerland

⁴ https://www.gov.uk/tax-return-uk