Imagine a place where your dollars can go further, taxes are low, and obtaining a residency is pretty straightforward. Think no more, as that place is Latin America!
This region is filled with viable places to live and enjoy affordability and tax efficiency—all while securing solid second residency permits. From the near-zero-tax jurisdictions of Paraguay and Panama to vibrant countries like Costa Rica and Brazil, you’ll discover the best places for expats to live in Latin America in this article.
Chile is the country that my wife and I chose for birth tourism for our third child. The country is known for its striking natural beauty and stable economy and is an appealing destination for expats seeking quality of life and opportunity. The country's diverse landscapes, from the arid Atacama Desert to the lush vineyards of the Central Valley and the breathtaking fjords of Patagonia, make it a haven for adventurers and nature enthusiasts alike.
Chile boasts one of the strongest and most stable economies in Latin America, supported by its robust mining and export sectors. The cost of living can vary significantly depending on the region, with Santiago being the most expensive, while smaller towns and rural areas offer a more affordable lifestyle.
Residency in Chile is relatively straightforward, with options like the Temporary Residence Visa for professionals and investors or the Retirement Visa for retirees with proven income. These programs allow you to live, work, and invest in the country while enjoying Chile's high standard of living.
People who are resident or domiciled in Chile are subject to income tax on their worldwide income. However, individuals establishing domicile or residency in Chile are taxed only on Chilean-source income for the first three years. This period may be extended upon application. Non-residents and non-domiciled persons are taxed solely on their Chilean-source income.
Paraguay, a low-cost, energy-independent gem, produces food for 8.5 times its population. With 10% taxes and easy residency options, it’s perfect for digital nomads, investors, and those seeking a Plan-B
Paraguay, a landlocked country in the heart of South America, has been a favourite destination of mine for over a year. I visited this country in November 2023 after a trip to Uruguay, and I admit I was shocked by the potential Paraguay holds. First, it’s a food- and water-independent country that will give you peace of mind. To illustrate, Paraguay produces enough food for 8.5 times its population!
The cost of living is extremely low because of factors like the country’s massive energy production. The Yacycretá and Itaipu dams provide millions of MWh annually, ensuring that Paraguay never runs out of energy. The excess is sold to neighbouring Argentina and Brazil, further contributing to Paraguay’s economy. The low energy costs paired with the country’s food production help prices remain low.
The residency options in Paraguay are also varied, and you’ll find the right path whether you’re an adventurous digital nomad or an ambitious investor seeking to build a Plan-B. Indeed, with a meagre investment of $70,000 USD through the SAUCE route (basically a business residency by investment program), you can fast-track your permanent residency process. Moreover, you can make that investment in installments and don’t need to pay it all at once.
When it comes to taxes, Paraguay doesn’t disappoint. The top income, corporate, and value-added taxes sit at a low 10%. Still, the best part is that Paraguay also has territorial taxation, making it an ideal location for online business owners or anyone earning foreign-earned income.
Costa Rica offers expats a tropical lifestyle, diverse residency options, territorial taxation, and affordable healthcare. With stunning beaches and welcoming locals, it’s a top choice for a laid-back, healthy life
Costa Rica is a peaceful nation that offers expats a tropical lifestyle paired with modern conveniences. Known for its stunning beaches, lush rainforests, and welcoming locals (“Ticos”), Costa Rica has become a top destination for those seeking a laid-back and healthy way of life.
The country’s residency options are diverse and accessible. The Pensionado Visa is designed for retirees with a monthly income of at least $1,000 USD, while the Rentista Visa is ideal for those with a guaranteed income of $2,500 USD per month. There’s also the Investor Visa, which requires an investment of $150,000 USD in real estate or a local business.
Costa Rica’s tax system is favourable for expats. The country applies territorial taxation, meaning foreign-earned income is not subject to local taxes. This makes it a prime choice for digital nomads and entrepreneurs with global income streams.
Beyond taxes, Costa Rica’s healthcare system is another draw. Expats can access affordable, high-quality healthcare through the public “Caja” system or private hospitals and clinics. Coupled with the nation’s emphasis on sustainability and its friendly culture, Costa Rica is a paradise for expats of all ages.
Uruguay, known for its peace and stability, offers safety, property rights, and an 11-year tax holiday on foreign income. With European charm and low corruption, it’s a smart option for a Plan-B
Uruguay, also known by the locals as “the country where nothing happens” due to its peaceful environment, is arguably one of the most stable countries in Latin America and the world. This feature makes it a country worth exploring, but you'll be shocked when you uncover everything it has in store.
First, Uruguay differs from many Latin American countries given its strong European heritage, mostly imported from Spain and Italy. If you’ve ever visited this part of the world, you’ll have noticed that Uruguay is special. Argentina is the only country in the region that resembles Uruguay in any way, but Argentina is still undergoing significant reforms to become a serious Plan-B destination.
Uruguay, though small, is a safe and welcoming country for all types of expats. It has gained a reputation for being one of the least corrupt nations on Earth, which provides a solid foundation for protecting personal, economic, and political freedoms. Also, locals and expats can purchase property without restrictions and enjoy the same rights as citizens, and private property is well-protected. From extensive farmland to premium beachfront houses and everything in between, expats will find various property types that suit their preferences.
Finally, Uruguay’s tax situation is unique. Even though regular tax residents pay an income tax rate of up to 36%, expats can benefit from an 11-year tax holiday program. This program allows foreign-sourced income to be tax-free during that time, but it is also possible to claim a permanent 7% rate.
Panama, a stable and tax-friendly hub, is ideal for expats. With a dollar-pegged currency, low inflation, and diverse visas, it offers a perfect base for investors, retirees, and digital nomads seeking a Plan-B or permanent home
Panama, a well-connected Central American country, has been my home since I moved out of the UAE in 2019. As I explained in a previous article, I came here not only because of Panama’s tax-friendly system but also because it’s a great hub for exploring the region and an excellent base of operations. Most of my clients live in North America, so living in Panama’s time zone helps me accommodate their needs.
Panama’s economy is stable. According to Statista, the country's top inflation rate was a meagre 2.86% in 2022, while countries like the U.S. suffered from an astronomical 8%. Apart from stability, expats can benefit from various visa types suited to every need. Whether you’re a digital nomad, a retiree, or an accredited investor, your money is welcome in the country. Plus, locals and foreigners have the same right to purchase property, which is a breeze for foreign investors.
Panama uses the Balboa—pegged to the U.S. dollar—as its official currency, which grants further stability to the economy and helps avoid currency conversions for multiple expats. However, its tax-friendliness makes Panama attractive as a Plan-B destination or even a permanent home. The country has a territorial tax system, so foreign-sourced income is tax-free.
With clients, I explored why Latin America offers so much to expats—affordable living, tax perks, and friendly cultures. A region full of opportunities for second residencies or strategic investments
Latin America offers multiple opportunities for expats seeking a mix of affordability, tax advantages, and welcoming cultures. Let’s recap what we’ve seen in each country. Each country has unique advantages, which makes it essential to explore your options carefully. Whether you’re looking for a second residency, a new home, or simply profitable investments, Latin America is a region of opportunities for you. If you’re ready to know more about the expat lifestyle and are serious about making it a reality, subscribe to our newsletter, and you’ll get our free special report, ‘Plan-B Residencies & Instant Citizenships.’