Global average income compared

Switzerland is ranked the highest among 41 countries for high take-home pay and low tax rates, according to CapRelo.
Danes pay a whopping 56% tax, ranking the Nordic country the highest when it comes to tax rates by a Global Taxes report by CapRelo. Picture: Supplied

When you’re thinking about moving to another country there are a host of factors that need to be considered, like will the climate suit you, are the laws very stringent, is the culture adaptable, are the transport systems going to be workable and most importantly, is it affordable?

If you’re living in South Africa, climate doesn’t seem to be a bother, (unless you’re in Cape Town), the culture is diverse, e-tolls are everywhere and according to a Global Taxes report by CapRelo, the average South African earns, $12 535 (R151 626) a year, and with a 19% tax deduction, you’re taking home an average of $10 173 (R123 055) annually.

CapRelo is a global mobility and relocation management company and from a list of 41 countries it ranks Switzerland as number one as it has the highest average pay and lowest tax rate. Your average take home pay will be $85 718, and with a tax deduction of 2%, you’d have $84 006 to spare. If you can brave the snow and the cold, Switzerland might as well be added to your bucket list.

A complete shift from the Swiss Alps is the land of spice and heat. CapRelo ranks India as having the lowest average take-home pay of only $1 670 but the bonus is that zero tax is deducted.

Second last, in terms of pay, is Indonesia. The average pay sits at $3 400, and with a 5% tax deduction you’ll have $3 230 a month to spend on the flavourful foods of the east.

Saudi Arabia, with all the oil that the US wants and where Middle Eastern royalty sits, also falls within the zero tax ranks. Take-home pay averages at about $21 720. An inexpensive meal in Saudi Arabia would cost you about $5.33, according to Numbeo.com.

The USA on the other hand, deducts 18% tax on an average $64 154 of annual take-home pay. This leaves you with $52 344 to use for your living costs, take aways, Knicks tickets and Super Bowl games.

If running away to Australia has been on your to-do list, then you are likely to earn $59 538 on average. The government takes away 21% of that for taxes and you’re left with $46 78. You just have to get the accent right to fit in.

Practical rate at which the average US salary ($64 154) would be taxed in other countries: 

Source: CapRelo – Global taxes

Moving to the Nordic regions, Denmark has always been praised for its laws and free-education policy, but living there may not be as easy. Denmark’s tax rates are ranked the highest according to CapRelo. In USD, the average individual earns $64 310 a year and with a 56% tax deduction, you’ll have around $28 227 to spend. That’s a whole $36 083 difference. While the country may seem pretty, it’s also pretty unaffordable.

Sweden falls in second behind Denmark in the high-tax region. If you decided to settle in Sweden, and lived in flat but  picturesque Stockholm, your take home pay would average at about $46 804 and after a hefty 52% tax deduction, you will have about $28 227 to spare. For interest’s sake, the price of a loaf of white bread there costs $3.01, according to Expat Arrivals. It ain’t cheap.

Living close to royalty in the United Kingdom means there’s an average take-home pay of $46 252. Your Highness will take away 13% of taxes, leaving you with $40 169. According to CapRelo that’s around $6 083 less than the original. 

To be señor or señorita in Spain, you will earn on average $30 613 a year, minus 30% tax, you’ve got $21 429 to spare.

On the other hand, if pizza and pasta are part of your staple diet now and you don’t mind making lifestyle changes for it, then in Italy, your average annual take home pay would be around $32 205. Take away 27% tax, and you’ve got about $23 510 left to spend.

If you fancy the French and have a taste for fine food, your average earnings would be around $40 718, the French government will take away 30% for taxes and you’ll be left with $28 503. That’s essentially a difference of $12 215. According to internationalliving.com, your average monthly living cost would total $267.82, this includes gas, electricity and telephone bills, food and soirees.

Post-tax take home pay for average wages around the world in USD

Source: CapRelo

Moving over to the East, countries in Asia are gaining popularity for their teaching opportunities. If this is a dream of yours and you’re wondering if you will make the cut for living comfortably, here are the the stats:

The Japanese live off an average pay of $35 279 after a 10% tax deduction.

South Koreans earn $29 125 on average, the government deducts 12% tax and this leaves them with $25 754, which is relatively high compared to the Chinese.

In populated China, the average earning is $8 250, and with 12% tax deduction, you’re earning $1 003 less, this leaves you with $7 247 to survive, (which helps since everything in China is quite cheap).

The world is your oyster, like they say and you can take whatever opportunity you would like from it, but oysters are expensive and so is surviving.

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Very sloppy article. AFAIK in Switzerland your income tax varies from canton to canton. You pay federal, cantonal and municipal income tax and the total paid can be very different from place to place. For example in Zug a married couple with two kids would pay less than 2% on an income of 100000CHF, but in Neuchatel nearly 10%. Above the income taxes you also pay wealth tax which also varies from place to place.

I was also interested why the Swiss can have such low taxes. According to the google machine there are these deductions as well:

The following deductions are taken from an employee at source:

Old-Age and Survivors’ Insurance (OASI), Disability Insurance (DI) and Income Loss Insurance: 5.05% of salary (without a ceiling)
Unemployment Insurance (UI): 1% of salary (ceiling: CHF126,000 p.a.)
Occupational pension provision: roughly 7.5% of regular salary, depending on the age of the insured person and the pension scheme
Non-occupational accident insurance: between 0.7% and 3.4% of salary (ceiling of salary: CHF126,000 p.a.), depending on the sector.

This will typically be part of tax in a high tax country like the Netherlands.

Then nothing is free/highly subsidised as in some of the social democratic countries. Healthcare 600/700, public transport (all roads are tolled)

This with regards to healthcare also from the net

“Switzerland’s healthcare system derives a significant portion of funding from mandatory Swiss health insurance premiums (averaging around EUR 450 per month) and out-of-pocket payments, meaning there is no free healthcare in Switzerland. In line with the high cost of living in Switzerland, Swiss health insurance equals around 10 percent of the average Swiss salary. ”

So I think if you add all of this up + the fact that Switzerland is eye wateringly expensive you probably not much better off

Not a surprise. This country is awash with the worlds wealth that has to be managed – a very boring job in quite a boring (but beautiful) country…no wonder they’re so well paid, its to keep them from leaving for more exciting climes!

Very interesting article and a good and fun read.
I was looking for a relationship between rich and poor countries vs tax rate but couldn’t find any.

In Denmark you get plenty of things for free from the government (even money if you don’t have work – or let me rather say – don’t want to work). But even their VAT is sitting at 25%! so that actually means that they are socialist. The reason is simple: the government has more say about the money you work for than yourself.

That massive tax difference between aus and nz is interesting and will certainly contribute to people moving from nz to aus.

Unusual to see Romania & Bulgaria (and some other Eastern Europe countries) listed near the top.

It does not tie up, based on info from some Expat-websites in those countries. Incomes are way lower….and living expenses fairly comparable to that in SA in the mentioned two countries. (Unlike ‘Western’ Europe which has way more earnings & living expenses)

Maybe a high-paid tech salary was used as comparison(?), otherwise not so sure.
Fun read, nevertheless…

End of comments.

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