Every American abroad files a U.S. return. Whether that return produces a tax bill depends almost entirely on where you live — specifically on three things: how your host country's rates compare with U.S. rates, whether a totalization agreement exists, and whether you're employed or self-employed. This page puts the 18 countries ClearedExpat covers side by side on exactly those points.
Key findings
- In 9 of 18 countries, a salaried American earning $100,000 owes zero U.S. federal income tax with near certainty — every high-tax country, where the Foreign Tax Credit more than covers the U.S. bill. In the remaining eight the answer is "usually zero," decided by effective local rate and income mix.
- The zero-tax countries are where Americans are most likely to owe U.S. tax. In Qatar and the UAE there is no foreign tax to credit; the FEIE covers the first $132,900 (2026) and everything above it is taxed by the U.S. at normal rates, with the excluded amount still setting the bracket. A $200,000 earner in Dubai typically owes U.S. tax; a $200,000 earner in Munich typically owes none.
- Only 9 of the 18 have a totalization agreement — Australia, Canada, France, Germany, Japan, Portugal, South Korea, Spain, United Kingdom. In the other nine, self-employed Americans owe the full 15.3% U.S. self-employment tax with no relief, which for a $100,000 freelancer is roughly $14,000 — larger than most people's entire income-tax exposure.
- Three countries have no U.S. income tax treaty at all: Qatar, Singapore, UAE. For earned income this matters less than people assume — relief comes from domestic law either way — but it removes pension articles, tie-breakers, and withholding reductions.
- Two widely repeated "facts" are wrong. The U.S.–Mexico totalization agreement was signed in 2004 and never entered into force. The U.S.–Thailand income tax treaty, by contrast, has been in force since 1998 — it is the "no Thailand treaty" claim that is the myth.
The comparison: 18 countries
"Outcome" is for a salaried employee earning $100,000 who qualifies for the FEIE under either the bona fide residence or physical presence test, with no significant U.S.-source or investment income. Self-employed outcomes are different — see the totalization column and the FAQ.
| Country | Top local rate | U.S. tax treaty | Totalization agreement | Winning tool | U.S. income tax, $100K salary |
|---|---|---|---|---|---|
| Australia | 47% (incl. Medicare levy) | Yes | Yes | FTC | Zero |
| Canada | Up to 53% (federal + provincial) | Yes | Yes | FTC | Zero |
| China | 45% | Yes | No | FTC or FEIE | Usually zero |
| France | 45% + social charges (up to ~62%) | Yes | Yes | FTC | Zero |
| Germany | 45% + solidarity surcharge | Yes | Yes | FTC | Zero |
| India | 30% + surcharge and cess | Yes | No | FEIE or FTC | Usually zero |
| Israel | 50% | Yes | No | FTC | Zero |
| Japan | ~55% (national + local) | Yes | Yes | FTC | Zero |
| Mexico | 35% | Yes | No — signed 2004, never in force | FEIE or FTC | Usually zero |
| Philippines | 35% | Yes | No | FEIE or FTC | Usually zero |
| Portugal | 48% + solidarity surcharge (20% under IFICI) | Yes | Yes | FTC (FEIE under IFICI) | Zero |
| Qatar | 0% | No | No | FEIE | Zero up to $132,900 — U.S. tax above |
| Singapore | 24% | No | No | FEIE | Zero up to $132,900 — partial FTC above |
| South Korea | 45% + local income tax | Yes | Yes | FTC | Zero |
| Spain | Up to 54% (regional) | Yes | Yes | FTC | Zero |
| Thailand | 35% | Yes (in force 1998) | No | FEIE (FTC if Thai tax paid) | Usually zero |
| UAE | 0% | No | No | FEIE | Zero up to $132,900 — U.S. tax above |
| United Kingdom | 45% (47% Scotland) | Yes | Yes | FTC | Zero |
How to read your row
If the winning tool is FTC: your host country taxes you harder than the U.S. would. File Form 1116, claim the credit, owe nothing, and carry the excess credit forward for up to ten years. Do not elect the FEIE — once revoked, it can't be re-elected for five years without IRS consent, and in a high-tax country it usually produces a worse result than the credit. Full reasoning in FEIE vs FTC.
If the winning tool is FEIE: your host country taxes you lightly or not at all. File Form 2555, exclude up to $132,900 of earned income (2026), add the Foreign Housing Exclusion if your rent is high, and expect to owe U.S. tax only on income above the limit. Use the FEIE eligibility checker to confirm you qualify and the calculator to size the exposure above the cap.
If it says "FEIE or FTC": model both. The break-even is roughly where your effective local rate crosses your effective U.S. rate — typically somewhere in the $120,000–$180,000 range for a single filer, lower if you have children (the Foreign Tax Credit preserves the refundable child tax credit; the FEIE can eliminate it).
Methodology and sources
Top local rates are the statutory top marginal rates for resident individuals in each country as of 2026, including mandatory surcharges where they are effectively part of the income tax (Germany's solidarity surcharge, Australia's Medicare levy, Korean local income tax) and noted separately where social charges materially change the picture (France). Treaty status is from the IRS treaty list; totalization status is from the Social Security Administration's list of agreements in force. The FEIE limit is $132,900 for tax year 2026 per Rev. Proc. 2025-32 ($130,000 for 2025). Outcomes are the typical result for a salaried employee under the stated assumptions and are not a substitute for running your own numbers. Each country's full treatment — pensions, capital gains, FBAR specifics, local quirks — is in its linked guide.
Using this comparison
Journalists, relocation companies, and other publishers are welcome to reproduce the table or cite the findings with attribution and a link: "Source: ClearedExpat, U.S. Expat Tax by Country 2026, https://www.clearedexpat.com/guides/us-expat-tax-by-country/". For questions on the data or a country not covered here, email tax@clearedexpat.com.
