1. The Fear of Being Taxed Twice

For many Americans considering a European base, the biggest concern isn’t just the move — it’s the IRS. The U.S. is one of the few countries that taxes citizens on worldwide income, regardless of where they live. But that doesn’t mean double taxation is inevitable.

In this post, we’ll explain how high-net-worth individuals can legally reduce — or even eliminate — the risk of being taxed twice while enjoying life in Europe.

2. Understanding the Basics: U.S. Taxation of Expats

• The U.S. taxes citizens on global income, even when living abroad
• Must file annually with the IRS (Form 1040 + foreign income disclosures)
• Common disclosures:
  • FBAR (Foreign Bank Account Report)
  • FATCA (Foreign Account Tax Compliance Act)

3. Tools to Avoid Double Taxation

A. Foreign Earned Income Exclusion (FEIE)

• Up to ~$120,000/year excluded if you meet either:
  • Bona Fide Residence Test (full calendar year)
  • Physical Presence Test (330 days in 12 months)

B. Foreign Tax Credit (FTC)

• Credits U.S. taxpayers for income taxes paid abroad
• Helps if income is earned through foreign business or investment

C. Tax Treaties with Spain & Portugal

• Both countries have agreements with the U.S. to avoid double taxation
• Treaties help clarify which country has taxing rights over what income

4. When Does Living in Spain or Portugal Make You a Tax Resident There?

• In Spain: 183+ days/year, center of vital interests, or main business base
• In Portugal: 183+ days/year or residence with intent
• Becoming a tax resident can open doors to local programs, but must be planned carefully

5. Tax Regimes That Can Work in Your Favor

🇵🇹 Portugal – Non-Habitual Resident (NHR) Regime

• 10-year tax benefit period
• Foreign-sourced income (like dividends or pensions) can be exempt
• Flat 20% rate on qualified Portuguese income

🇪🇸 Spain – Beckham Law

• Applies for newcomers working in Spain
• Foreign income excluded, local income taxed at flat ~24% for 6 years

6. Smart Structuring for Global Citizens

• Use of holding companies, trusts, and foreign pension structures
• Residency planning should align with lifestyle and legal strategy
• Key: don’t trigger residency unintentionally through property use or length of stay

7. How Beyond Helps

At Beyond, we work with a network of international tax specialists to ensure that your property and residency journey is aligned with your global tax reality. From legal advice to asset structuring, our approach is discreet, strategic, and grounded in deep cross-border expertise.

Living in Europe doesn’t have to mean paying more taxes.

The right planning — and the right partners — can transform complexity into clarity.

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