| Today more than ever before, American seniors | | | | eligible. |
| are choosing to retire abroad. In 2004, an | | | | Under Panama's "pensionado" system, pensioners |
| estimated 255,000 Social Security checks were | | | | are eligible for 15% discount on hospital services in |
| mailed to countries outside of the United States. | | | | private clinics, 10% discount for medicine, 20% |
| In the past twenty years, the advent of new | | | | discount on medical consultations and surgical |
| technology, namely the Internet, has spawned the | | | | procedures and 15% off of dental and optical |
| global community. No matter where you call | | | | services. |
| home, accessing bank accounts, filing taxes, and | | | | 3. France |
| communicating with friends and family, is just a | | | | Retirees certainly can appreciate France's lower |
| mouse click away. This in itself has made retiring | | | | tax rate for "pensioners" - a retired couple can |
| overseas more feasible and attractive to many | | | | have a joint income of up to approximately |
| seniors who previously may not have ever | | | | $102,000 USD and pay about 14% in taxes. That |
| considered an exotic, foreign location to live out | | | | may be better than what could be expected in |
| their golden years. | | | | the U.S. |
| Some places are better to retire in than others, | | | | Housing is rather expensive in France, with the |
| based on key factors such as tax liability, real | | | | average property going for around $275,000 USD |
| estate costs, ease of obtaining residency, health | | | | - one of the highest areas to purchase property |
| care, climate and culture. Many a retiree has had | | | | in the study and prices are only going up. Buying |
| to abandon their dream of living abroad, having | | | | costs are 7% for existing homes, 3% for newly |
| grossly underestimated the cultural and financial | | | | built properties and real estate fees are |
| burdens related to their region of choice. Selecting | | | | approximately 6%. |
| a retirement location abroad should involve careful | | | | If you spend longer in France than in any other |
| research and planning. According to an article | | | | tax jurisdiction during one year's time, you are |
| featured in the UK's The Times Newspaper on | | | | automaticallyconsidered a resident for tax |
| January 20, 2008, comprehensive research on the | | | | purposes. |
| subject conducted by the Homebuyer and | | | | France has a public health system and while |
| Property Investor Show, provides a list of the 10 | | | | retirees are not required to join, they will need a |
| most popular retirement countries, based on the | | | | specific plan that covers all of their medical |
| above key factors. The following are the top five | | | | expenses. Typically, the public health system pays |
| countries on this list, along with a brief overview | | | | 70% - you will want to look into a supplement |
| of the report's findings: | | | | that will provide benefits for the other 30% not |
| 1. Cyprus | | | | covered. |
| Currently, overseas retirees who have lived in | | | | 4. Belize |
| Cyprus for at least 183 days, are taxed on their | | | | Belize's official language is English, has a tropical |
| retirement income at the rate of 5% per year. | | | | climate with a definite rainy season, and enjoys a |
| Otherwise, the normal rate is no tax on the first | | | | low cost of living. |
| $28,516.46 USD, then rising to 30% on $53,085.05 | | | | Income tax is 1.75%, but some income such as |
| USD. | | | | pensions, is tax free. There is also no capital gains |
| Assets maintained in the United States, such as | | | | tax or inheritance tax for people retiring to Belize. |
| bank accounts and stock portfolios, will be taxed | | | | Personal belongings such as cars and boats can be |
| by the IRS. This situation can be avoided by | | | | imported, duty-free. The maximum tax on any |
| moving assets to an offshore account, then | | | | one item is $15,000. |
| subsequently bringing those assets into Cyprus. | | | | If you dream of living on the beach, a |
| Cyprus has no inheritance tax; however, expats | | | | three-bedroom property will set you back around |
| need to provide documentation that all ties have | | | | $375,000. Associated stamp duties are 5%, legal |
| been severed with their previous country to | | | | fees are around 2% and there is a 1.5% transfer |
| enjoy that benefit. | | | | tax when you sell a property. |
| A starting price for Cyprus property is about | | | | If you are age 45 or over, you can apply for |
| $150,846.69 USD, but this will likely continue to | | | | permanent residency through Belize's government |
| rise as the area gains in popularity. Stamp duty (a | | | | retirement program. As a "qualified retired |
| percentage paid on certain documents such as | | | | person," you are eligible for tax exemptions and |
| loan contracts) is 0.15% for properties up to | | | | incentives, as well as other benefits. |
| about $254,626.68 USD and 0.2% on more | | | | Belize has a national, tax-funded healthcare |
| expensive residences. There may also be transfer | | | | service, but you may find its medical services |
| fees of 3% of the first $127,297.51 | | | | lacking. Private healthcare is available and |
| USD, 5% on homes valued from $127,297.51 USD | | | | inexpensive, however. |
| - $254,626.68 USD, and 8% on homes valued | | | | 5. Spain |
| higher than $254,626.68 USD. | | | | Spain is a very popular retirement destination, but |
| Retirees do not require a visa to move to | | | | because of their high tax requirements, it may |
| southern Cyprus, but a temporary residence | | | | not the best choice overall. Spanish residents |
| employment permit is needed and should be | | | | (spending more than 183 days annually), can |
| applied for upon arrival into the country. To buy | | | | expect to pay up to 40% on total income, |
| property, you must prove you have adequate | | | | regardless of origin. Capital gains tax is currently |
| resources to live in Cyprus without working - | | | | 18% and inheritance taxes for expats run |
| currently the minimum is about $15,672.63 USD | | | | anywhere from 7.65% - 34% depending on the |
| annually. | | | | amount inherited and the relationship of the |
| Medical care is provided by the government and | | | | person you inherit from. |
| through private medical establishments. | | | | Spanish residents also are liable for paying a |
| Government Medical Services can be used by | | | | wealth tax of 0.2% to 0.5% of their assets |
| anyone; however, U.S. retirees will need to pay | | | | worldwide. |
| the nominal fees as dictated by the system as | | | | An average retirement property will cost around |
| they are not likely eligible for free treatment. | | | | $268,000 USD, and property fees can add on an |
| 2. Panama | | | | additional 10%. |
| U.S. retirees will feel right at home in Panama, as | | | | There is free universal health care in Spain. To |
| English is commonly spoken and the main | | | | become insured, you have to have a |
| currency is the US dollar. | | | | Spanish-issued social security number. To get one, |
| All income from assets outside Panama are TAX | | | | you will have to either work or become self |
| FREE. However, there is a 5% transfer tax on | | | | employed to pay into the system. Otherwise you |
| goods and services. There is no inheritance tax, | | | | will need to look into private health insurance. |
| but gifts of property may be subject to 4% - | | | | Even though you may initially consider climate, |
| 33% levy, depending on the beneficiary | | | | breathtaking vistas and scrumptious cuisine when |
| relationship. Again, U.S retirees will still need to pay | | | | deciding where to retire abroad, the choice should |
| income tax to Uncle Sam as long as they remain | | | | rest at the bottom line - your finances. Crunching |
| U.S. citizens. | | | | the all-important numbers will ultimately dictate if |
| Buying a home is Panama is surprisingly expensive | | | | you can actually afford to live out your |
| and you can expect to pay around $215,000 USD | | | | retirement fantasy. |
| for a median property. Anyone buying property | | | | Sources: |
| can apply to become a permanent resident one | | | | 1. "Revealed: the best places in the world for |
| year after having applied for a residence visa. The | | | | retirement;" Jessica Bown; The Sunday Times, |
| total value of your property and local bank | | | | January 20, 2008. |
| accounts must equal at least $200,000 USD to be | | | | |