The growing relevance of Europe’s tax incentives in global hiring strategies

A growing number of Americans are trading San Francisco and New York for Madrid, Lisbon, and Copenhagen, and governments across Europe are happy to welcome them.

In Italy alone, registrations of American residents jumped 42% between 2019 and 2022, reflecting a broader surge of high-earning professionals seeking new opportunities overseas.

While lifestyle and cost of living remain the main draw, fiscal incentives are adding to the appeal. Several European countries, including Spain, Denmark, and Italy, have introduced or expanded special tax regimes that offer significantly reduced income tax rates for qualifying newcomers.

As more professionals explore moving abroad for work, companies and HR leaders should recognize the value that these programs bring while compensation planning during global hiring.

Here’s what special tax regimes mean for global hiring, how it works, and how HR leaders should be thinking about it.

Why HR and talent leaders should care about special tax regimes

1. Attraction and retention of globally mobile talent

When you’re hiring senior engineers, design leads, revenue‑generating roles across EMEA, your talent pool is global.

If a role offers a potential hire the opportunity to work from a country with a favorable tax regime, it can enhance the total compensation experience for the candidate — without increasing employer cost. That added value can help elevate the offer in a competitive hiring market.

We’ve seen that when job opportunities include built-in advantages like tax efficiency, they can influence top talent’s decision-making, especially for globally mobile candidates. For fast-scaling organizations, those added benefits can strengthen offers and improve hiring outcomes.

2. Strengthened total rewards without raising headline cost

You may not be able to raise gross salary for every hire. But by choosing where the employee is hired, and using existing incentives, you can potentially deliver higher net income to the employee while keeping cost to you stable.

That means your budget for hiring remains under control, and you still deliver more value to the employee. A win-win for both sides.

3. Compliance and risk management in global hiring

Hiring internationally is about much more than the job description. Tax, employment law, benefits, payroll: the full stack matters.

If a special tax regime is misapplied or mishandled, employees may lose the benefit and face unexpected tax liabilities, including paying back taxes at standard rates. That creates legal risk, financial stress, and frustration for the employee. As HR leaders, we need solutions that minimize complexity without relying on costly, advisor-heavy processes for every hire.

What is a special tax regime in practice?

In simplest terms, a special tax regime is a governmental incentive that grants a favourable tax rate, tax‑treatment exemption or other benefit for eligible employees, often expatriates or newly relocated workers.

Here are some real‑world examples:

• In Spain, the so‑called “Beckham Law” (special regime under Article 93) allows eligible employees to pay a flat tax rate of 24 % on employment income up to €600,000 under certain conditions.
• The 30% ruling in the Netherlands allows eligible employees hired from abroad to receive up to 30% of their salary tax-free for five years. It’s designed to offset relocation costs and can enhance total compensation without increasing employer spend.
• Italy offers generous tax relief for returning professionals and expats, including up to 50% income tax exemption under the Inbound Workers Regime.
• Belgium offers tax-efficient options like warrants in place of bonuses, tax-free per diems, and benefits in kind that reduce overall tax liabilities. These tools help optimize compensation packages for both employees and employers.
• More broadly, an overview of eight European countries shows regimes for inbound expatriate workers that offer features like reduced taxable income, flat tax rates, or allowance exemptions.

Key takeaways for HR teams

• These regimes often require eligibility conditions: non‑residency prior to relocation, an employment contract in the country, duration limits, etc.
• Not all employees in all countries qualify, and not all countries have regimes tailored to your use case.
• Admin and compliance still matter. The benefit is real, but you need correct set‑up.
• From an employer side: if you can systematically integrate these advantages into your hiring model, you create a differentiator.

How Remote’s tax regime support changes the game

Here’s where Remote makes a meaningful difference for scaling companies. Let’s walk through the value‑add from a HR and global talent leader’s lens:

• Inclusive within the EOR experience: Remote is the only EOR in the market offering in‑house enrolment for eligible special tax regimes for employees in EMEA. That means you don’t need a separate advisor, and you don’t need to set up every regime manually.
• Net income advantage for employees, no extra employer cost: For eligible employees, this means they can earn more (via tax savings) while you pay the same headline cost. That strengthens your proposition to top talent.
• Enhancing your total rewards package: You’re effectively adding a benefit: tax‑efficiency, without increasing your salary spend. That shows strategic thinking in your People operations.
• Attraction and retention benefit built‑in: In a market where talent has choice, being able to say “we support special tax regimes” can be a differentiator in job offers, especially for senior hires, remote roles, or cross‑border teams.
• Compliance and operational simplicity: Remote’s tax team handles the local regime enrolment, integration within the payroll system, and ongoing compliance, minimising risk for your business and your employee.

Real world impact: Early data shows European employees using Remote’s tax‑regime support made on average ~€14 k more per employee. That number is meaningful when you scale 10s or hundreds of hires.

How HR and talent leaders can take action

To make the most of these incentives, start by mapping your global hiring footprint. Identify roles that are eligible for relocation or remote work within EMEA, and flag employees in countries with active special tax regimes such as Spain, Portugal, the Netherlands, or Denmark.

Next, review your total rewards strategy through a net-income lens. Ask: how much will this employee actually take home after taxes? Could a different hiring location or tax-regime structure improve that? This approach helps you stay competitive without inflating budgets.

Partner with your global employment provider or EOR to manage eligibility and compliance. Providers like Remote can handle enrollment directly within payroll systems, reducing complexity and risk.

Communicate transparently with candidates and employees. For high-value hires, highlight the benefit clearly: “Under X’s special tax regime, Y will be your net take home income.” Transparency builds trust and enhances your employer brand.

Finally, monitor changes continuously. Tax regimes evolve. Eligibility rules, caps, and durations can shift, so make sure your tax or legal partner keeps you informed.

These programs are most valuable when you’re hiring senior or specialized roles, supporting employee relocations, or competing for top talent in tight markets. They also make sense if you’re using an EOR model and want to enhance compensation packages without increasing costs.

A closing word for HR leaders

In a global talent market where every advantage counts, special tax regimes provide a hidden lever that many hiring teams overlook.

For many employees, these programs mean they can significantly reduce their tax burden, while maintaining lucrative remote roles or new contracts abroad.

For HR, People, and Talent leads who work in scaling organisations, this is your opportunity: embed a tax‑efficiency benefit into your global hiring playbook and differentiate your employer brand.

And now for the first time in the employer‑of‑record (EOR) space, you can incorporate them directly into your global hiring strategy.

With solutions like Remote’s tax regime support built into the EOR experience, you no longer need to navigate dozens of country‑specific tax arrangements alone.

Instead, you focus on what you do best, hiring great people, while giving them a meaningful take‑home advantage.

If you’re hiring or planning to hire across EMEA, contact your global employment provider (or Remote) and ask: which special tax regimes are eligible for my hires, and how can we build them into our offer today?

Ready to explore further?

Contact Remote  today to discuss how special tax regime support can elevate your global hiring strategy and give your talent a real net‑income advantage.

This article is for general informational purposes only and does not constitute tax, legal or accounting advice. You should consult professional advisors regarding specific employee circumstances.

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