12 Countries with Residency/Retirement Visas and Favorable Tax Treatment for Foreign Pensions

In our previous IMI guide, we looked at all jurisdictions where foreign pensions are taxed at “single-digit” rates. But if you’re genuinely planning a retirement move, a different question becomes more important: which countries have built a clear program for retirees and paired it with a tax approach that matches the source of income—the pension.

Below are 12 countries that meet both criteria. In some, the retirement visa and the tax relief are essentially designed for pensioners from the start (Italy, Greece, San Marino, Malta). In others, the model is based on the territorial principle, meaning foreign-source income (including pensions) is typically not taxed automatically (Panama, Costa Rica, Nicaragua, Belize, Ecuador). There are also a few rarer cases where one element is less obvious, but the overall structure still fits retirees strongly: Cyprus, Mauritius, and Thailand.

In practice, the decision usually comes down to three core parameters: the minimum income threshold, the effective tax rate on the foreign pension, and how long the favorable regime lasts—either until the visa ends or until you transition to the standard rules. Everything else (cost of living, healthcare, climate, integration) tends to follow from those three.

Important: this article does not include other popular destinations where there is a visa pathway, but the pension tax benefit is either missing or not specifically available to retirees.

Europe

1. Cyprus (5%)

Cyprus offers one of the lowest pension-related tax rates in Europe. Tax residents can choose between the progressive system and a flat 5% rate on foreign pension income, starting from amounts above €5,000 per year. As part of the 2026 tax reform, the exemption threshold increased from €3,420 to €5,000 (effective from January 1, 2026). In other words, the first €5,000 is not taxed, and everything above is taxed at 5%.

For example, with a foreign pension of €50,000, the “flat” option typically results in tax around €2,250. Under a progressive approach, the tax could be much higher—roughly €10,400. The key detail is that the choice is made year by year, so if your income mix changes, you may be able to switch regimes.

Visa angle: Cyprus does not use a separate “pension visa” category. For EU citizens, freedom of movement applies; for non-EU residents, you rely on the standard residency routes (for instance, permanent residence through investment, a “financially independent” pathway, or a temporary status that can later lead to permanent residence).

Beyond the pension rate itself, Cyprus can further reduce the overall burden through the non-domiciled framework: if conditions are met, foreign dividends and interest may be exempt from tax for up to 17 years. For many pension portfolios, this combination can produce a materially lower effective tax load than in most Western European countries.

2. Italy (7%)

Italy is among the most straightforward jurisdictions for retirees, largely due to a fixed 7% tax on foreign income when you relocate to qualifying municipalities in Southern Italy. Starting April 7, 2026, the population cap for southern towns was raised from 20,000 to 30,000 residents (per Article 26 of Law 34/2026). This expanded the list by 74 additional municipalities, including places such as Pompeii, Noto, Ostuni, Manduria, and San Giovanni Rotondo.

The rule applies if you move your tax residency to municipalities in Sicily, Calabria, Sardinia, Campania, Basilicata, Abruzzo, Molise, and Apulia, as well as certain areas (including parts of Lazio, Marche, and Umbria that include “earthquake zones”). Under this regime, you can opt for a substitute tax of 7% on all foreign-source income—not only the pension, but also investment income, foreign rental income, capital gains, annuities, and other categories.

The selection is made for 10 consecutive tax years and cannot be extended. For municipalities located in “earthquake zones,” there isn’t yet a fully settled practice on the new 30,000 threshold, so it’s wise to confirm eligibility before moving.

To qualify, you must not have been an Italian tax resident for at least 5 consecutive years prior to the move. The regime replaces Italian national, regional, and municipal income taxes in full. It also includes exemptions related to Italian taxes on foreign assets (IVIE and IVAFE) and reduces reporting obligations for foreign holdings under certain RW-related requirements.

Residency route: Elective Residence Visa (Residenza Elettiva). Typically, you must show passive income of at least €31,160 per year, secure housing in Italy, and avoid working or self-employment. After 5 years of legal residence you may apply for permanent residency; after 10 years, you can become eligible for citizenship.

3. Greece (7%)

Greece offers retirees a non-domiciled-style regime with a fixed 7% rate that mirrors the Italian model, but with a longer duration. Once you become a Greek tax resident, eligible foreign pensioners pay 7% on all foreign-source income: dividends, interest, capital gains, and annuities—not just the pension.

The favorable period lasts up to 15 consecutive tax years, which makes it one of the longest fixed pension-style regimes in Europe.

Eligibility: during 5 out of the prior 6 years before applying, you must not have been a Greek tax resident. The move must also come from a country with an information exchange agreement with Greece or a double tax treaty.

Family members are not automatically covered—spouses/dependents must meet the requirements separately.

Visa route: Financially Independent Person Visa (FIP). You need to prove at least €3,500 per month of passive income, or show a deposit of €126,000 calculated over 3 years using the relevant income threshold. Additional family participants increase the requirement: +20% for a spouse and +15% per child. The permit is typically issued for 3 years, renewable, and maintaining status requires physical presence of at least 183 days per year.

Permanent residency may be possible after 5 years, while citizenship generally requires 7 years, including proof of Greek language knowledge.

4. San Marino (6%)

San Marino is a small enclave within Italy that taxes foreign pensions at a fixed 6%—the lowest dedicated pension rate for retirees in Europe. The regime lasts 10 years and can be renewed, often via a path that involves obtaining permanent residency.

From April 28, 2025, requirements tightened: your annual gross income must be at least €120,000 (previously €50,000). You also must hold a minimum of €300,000 in liquid financial assets in a San Marino bank account throughout the stay. Notably, this new rule is different from earlier practice, when assets held outside the country could be accepted.

The program is limited to private-sector pensioners who hold the relevant EU/Swiss (and certain other) statuses specified by the State Congress. Italian pensioners from the public sector under INPDAP are not eligible for the reduced rate.

The 6% rate applies to the gross pension amount. Other foreign income falls under a separate reduced regime for “non-typical residents,” with baseline limits of €10,000 minimum and €100,000 maximum per year.

5. Malta (15% under the Retirement Programme)

Malta’s Retirement Programme (MRP) has a headline rate that sits above the “sub-10%” band, but it still makes the list due to how the overall relief structure works. Foreign pension income paid into Malta is taxed at 15%, with a minimum annual tax of €7,500 and an additional €500 per dependent.

The central condition is that pension payments must equal at least 75% of your taxable income in Malta. For property, you must either buy real estate worth at least €275,000 (or €220,000 in Gozo/the south) or rent housing for at least €9,600 per year (or €8,750 in Gozo/the south).

Previously, the program was available only to EU/EEA citizens and Switzerland. Later, the government extended eligibility to third-country nationals.

How the 15% is “softened”: tax applies only to amounts remitted to Malta. Foreign income left outside Malta is typically not taxed. Also, foreign capital gains are generally not taxed in Malta for non-domiciled residents even if remitted, subject to the usual rules.

Physical presence requirements are at least 90 days per year on average over a 5-year period, with no more than 183 days in any single other jurisdiction. The program can lead to EU residency rights, access to a network of more than 70 double tax treaties, and—critically—predictability of the tax rate for the duration of your MRP status.

The Americas

6. Panama (0% on foreign-source income)

Panama is one of the most established retirement programs in the region: the Pensionado Visa has been in place since 1987 and has been refined over time. The income threshold is $1,000 per month for life in a pension paid by a foreign government, an international organization, or a regulated private pension structure. If you own real estate in Panama worth at least $100,000, the threshold drops to $750 per month. Each dependent adds $250 to the income requirement.

Panama applies territorial taxation: foreign-source income—including pensions—is not taxed under Panamanian income tax regardless of whether you transfer funds to local accounts or spend money inside the country. Capital gains earned abroad are also exempt.

Status: Once approved, the visa grants permanent residence immediately. To maintain status, you must travel to Panama at least once every two years, but there is no strict minimum number of days required per year. After 5 years, you may apply for naturalization—subject to demonstrating Spanish proficiency and at the discretion of authorities. Pensionado holders also receive statutory discounts on healthcare, transport, entertainment, and utilities.

In 2024, Panama approved 1,917 Pensionado visas—an all-time yearly high for the program.

7. Costa Rica (0% on foreign-source income)

Costa Rica’s Pensionado Visa requires $1,000 per month of lifetime pension income from a foreign source. A married couple can “combine” one pension: it’s enough that together they meet the $1,000 condition, and either spouse can be the beneficiary.

Costa Rica’s territorial tax model exempts foreign-source income for residents, including pensions.

Initially, residency is granted for 2 years and can be renewed in 2-year periods if you keep proving income and maintain physical presence of at least 4 months per year. Permanent residency is available after 3 years under temporary status; thereafter, the presence requirement drops to 3 days per year. Citizenship is generally possible after 7 years if you meet the Spanish language requirement.

After you obtain residency, enrollment in the Caja social security system becomes mandatory. Monthly contributions typically fall somewhere from the “high single digits” up to the mid-teens percentage range of declared income (depending on category). Public healthcare is delivered through Caja, while many expats also purchase supplementary private insurance.

8. Nicaragua (0% on foreign-source income)

Nicaragua requires $1,000 per month of foreign pension income for the Pensionado Visa and a minimum age of 45. The alternative Rentista Visa requires $1,250 per month and has no age threshold.

Historically, there were lower thresholds ($600 and $750), but those were adjusted: after amendments to Law 694 (via Law 987 in 2019), both figures were increased. Applicants who obtained residency before February 2019 may still qualify under grandfathering rules.

In 2024, the legal framework changed again. Law 694 was fully repealed by Law No. 1210 (the General Tourism Law), published in La Gaceta on August 2, 2024. The pension program is now administered directly by the immigration authority and the Ministry of Foreign Affairs rather than through the tourism institute, as it had been since 2009.

Nicaragua uses a territorial taxation approach: foreign pension income is exempt from local taxation. The visa is issued first as temporary residency for 1 year, renewable annually upon proof of income. Permanent residency is available after 3 years.

The 2024 reform also altered naturalization timelines: for most foreigners, the period was increased from 4 to 7 years of permanent residency. Additionally, constitutional changes in 2025 restricted dual citizenship for most foreigners (with an exception for residents of Central America). If naturalization is part of your plan, this is worth factoring in early.

Still, for retirees who prioritize long-term residency with relatively low “entry” costs, the territorial tax model and modest presence requirements remain appealing—despite infrastructure limitations and variability in healthcare quality.

9. Belize (0% on foreign-source income)

In Belize, the retiree offering sits under a dedicated category: the Qualified Retired Persons Program (QRP). It is administered not by immigration, but by the Belize Tourism Board. Eligibility starts at age 40, with proof of at least $2,000 in monthly foreign pension income.

Under the Retired Persons (Incentives) Act, beneficiaries are exempt from Belize tax on all foreign-source income, including capital gains and inheritances—regardless of whether you remit funds to Belize accounts. The exemption continues for the entire QRP status period.

There are also import benefits: you can bring in household goods, one vehicle, a light aircraft, and a motorboat duty-free during the first year after approval.

The minimum presence requirement is only 30 consecutive days per year. The card must be renewed annually, but the program is designed to be effectively ongoing. Importantly, QRP status does not automatically lead to citizenship. In December 2025, Belize’s cabinet approved a Fast-Track Permanent Residency concept with commercial investments at about BZ$1 million (roughly $500,000), though the implementing regulations were not yet published.

10. Ecuador (territorial approach with caveats)

Ecuador’s Pensionado Visa requires verified monthly income equal to three times Ecuador’s basic minimum wage. For 2026, the threshold is $1,446 (i.e., 3 × $482), and it is recalculated each year based on the minimum wage.

The visa is granted as temporary residency with the option to renew, and permanent residency becomes available after 21 months of legal residence.

Ecuador taxes based on residency, but in practice there are a few “territorial-style” caveats: foreign pension income for tax residents is typically not taxed, including due to the interaction with a network of double tax treaties.

Physical presence: to keep tax residency, you generally need at least 180 days per year. During the permanent residency period, your total absence cannot exceed 90 days. Under Article 71 of the Human Mobility Law (LOMH), naturalization may be possible after three years of permanent residency, and Ecuador allows dual citizenship.

For broader context on territorial regimes, see IMI’s analysis of 29 countries that exempt foreign income in 2026.

Indian Ocean and Asia

11. Mauritius (15% in headlines, but treaty-sensitive)

Mauritius updated its Retired Non-Citizen Residence Permit under the Finance Act 2025. For applicants age 50+, you must transfer $2,000 per month (or $24,000 per year) to a Mauritius bank account—higher than under the previous rules ($1,500 and $18,000, respectively).

The permit is issued for 10 years with renewals, and there is no minimum stay requirement. After 5 years, you may apply for permanent residency for 20 years if total transfers to Mauritius exceed $200,000.

The tax advantage here is largely structural rather than designed exclusively for pensioners. The baseline personal income tax rate is 15%, and Mauritius has double tax treaties with most countries where pension payments typically originate. Tax residency is triggered by physical presence of 183 days per year. If you stay below that threshold, you may hold the residence permit without becoming a Mauritius tax resident.

For residents, the effective tax burden on foreign pension income depends on the treaty and whether withholding tax applies at source. The remittance of foreign income to Mauritius is generally not taxed separately. Mauritius also has no inheritance/gift taxes, and capital gains from selling property in Mauritius are not taxed in these scenarios.

The logic of the program is that a retiree can “split” time between Mauritius and the country of origin while delaying or avoiding Mauritius tax residency for a long period—preserving flexibility.

12. Thailand (0% on foreign-source income within LTR)

In Thailand, the Long-Term Resident Visa (LTR) launched in 2022 and was clarified further in 2025. Within the LTR framework there is a Wealthy Pensioner category that combines a 10-year residency permit with a general exemption from Thai tax on foreign-source income.

This matters because Thailand changed its general rules starting January 1, 2024: foreign-source income remitted by a Thai tax resident is typically taxed in the year it is remitted, regardless of when it was originally earned. The LTR Wealthy Pensioner category is one of the key cases where the exemption applies.

Standard Thai pension visas (Non-Immigrant O-A and O-X) no longer provide this kind of exemption, so LTR has become a practical entry point for affluent retirees planning to spend more than half the year in Thailand.

To qualify, you must be age 50+ and prove $80,000 of annual passive income from pensions, dividends, rent, interest, or realized capital gains. If your passive income is below that, you can use an alternative path: hold at least $250,000 in qualifying Thai investments (government bonds, direct investments in Thai companies, or Thai real estate).

The visa is granted for 10 years (5+5 with extensions) and comes with annual immigration reporting instead of the standard 90-day reporting requirement used for other visa types. You can include a spouse, children under 20, legal dependents, and parents in the application; there is no numerical limit on dependents.

What didn’t make the list

The most notable exclusion is Portugal. Its Non-Habitual Resident regime—long considered one of Europe’s major retirement magnets—closed to new applicants on December 31, 2023. The replacement scheme (IFICI) excludes pension income. As a result, foreign pensions are now taxed under Portugal’s standard progressive scale, which can reach 48% at the top band plus additional solidarity surcharges. The D7 visa still exists as a residency route, but the pension-related tax advantage that made Portugal attractive for retirees no longer applies.

Spain offers a Non-Lucrative Visa for retirees, but there is no pension-specific special tax regime. Foreign pensions are taxed normally under the progressive framework (up to 47%). In addition, the Beckham Law (a flat regime for incoming workers) excludes passive income. Golden Visa was closed in April 2025, so the main routes for non-EU retirees are Non-Lucrative and Digital Nomad.

UAE does not levy personal income tax, but its residency programs are not structured as retirement schemes. The tax benefit is general rather than specifically “tailored for pensioners.” The same logic applies to Monaco, Bahrain, Brunei, and Vanuatu.

Uruguay is a special case. Tax Holiday 2.0 from 2026 (Ley 20.446) introduces an 11-year exemption for foreign capital income, followed by a transitional 6% rate for 5 years, and then the standard 12% IRPF applies. However, this is not a retirement program in the narrow sense: the relief is available to any new tax resident, not only retirees. That’s why Uruguay isn’t included as a “retirement tax construct,” even though—functionally—for certain retirees with qualifying income, the effect can resemble a pension-style regime.

Expert note: a lesser-known angle on foreign pension taxation

One nuance many retirees overlook is that “foreign pension tax treatment” is often driven less by the visa itself and more by how tax residency is determined and how treaty concepts are interpreted in practice. Even when a country uses a territorial approach, the tax authority may still look at whether your pension is considered “effectively connected” to local activity, whether the pension is classified as employment vs. social security vs. annuity, and whether the treaty article used to relieve double taxation is applied consistently year to year. This is why two retirees with the same pension amount can see very different outcomes depending on contract structure, remittance behavior, and their exact residency facts—not just the headline rate.

Planning a pension move and looking for a clear, predictable tax setup? At Digital Nomad we help you assess investment residence (“golden visa”) options and how your tax residency status may affect foreign pension taxation. Let’s review your case and the practical conditions together: https://digital-nomad.gr/en/goldenvisa

Our Telegram channel about various types of Greek residence permits, digital nomad programs, and the Greek Golden Visa: @digitalnomadgr