Stunning landscapes, delightful countryside, amazing cultural mix, and oodles of history everywhere – Europe never fails to impress; right? 

But the high cost of living in major cities, expensive entertainment, and lack of understanding about tax structures can bleed your pockets left, right, and center, especially if you are a freelancer or digital nomad. 

However, fret not.

To make your European stays super affordable and amazing without skimping out on adventures and quality of life, we are sharing a list of the top 12 cities to choose from. And yes, all these cities pass the three critical checks – tax, lifestyle, and vibe!

Top 12 European Cities for Self-Employed and Freelancers

🇨🇿 1. Prague – Czech Republic

15% Income Tax | Affordable Party Culture | Unparalleled Architecture

The party capital of the world – Prague, is also the capital city of the Czech Republic, which is one of the best countries for freelancers, self-employed, and digital nomads. Prague is famous for its happening nightlife, stunning backdrops, low crime rates, and low cost of living. 

The personal income tax rate is 15% for working employees with an annual income of  €80,648.

The city is well-connected with all parts of Europe and has a friendly and thriving expat community, which makes it easier to mingle and enjoy your stay. 

🇧🇬 2. Sofia – Bulgaria 

Income Tax 10% | Super Affordable Lifestyle | Party Culture

The capital city of Bulgaria is loaded with exciting places to visit, a bustling party culture that is super affordable for everyone, and comes with a personal income tax rate of just 10%.

What makes living in Sofia perfect for both freelancers and self-employed workers is the fact that the tax rates are fixed irrespective of income. 

So, you have to pay a fixed income tax (10%) as a freelancer, small business owner digital nomad, etc. The non-residents have to pay taxes only on their income generated from income sources in Bulgaria. 

🇱🇺 3. Luxembourg City

Income Tax Starts at 0% | High-Quality Living | Thriving Business Environment

Luxembourg is one of the major financial centers of Europe that offers a perfect mix of modern, fast-paced, and slow-paced lifestyle elements.

The cities like Luxembourg City, Differdange, and Dudelange offer world-class internet infrastructure, a multicultural community mix, and a happening lifestyle. 

The income tax ranges from 0 to 42% and there is no income tax on a yearly income of €12,438. The city is extremely safe, has a business-friendly environment, and offers an exceptional quality of life, especially if you earn income from international sources, political stability, and a supportive regulatory framework.

🇲🇹 4. Valletta – Malta 

Income Tax 10% | Rich Old-Europe Vibe | Affordable

Valletta is the capital city of Malta, which in turn is the dream destination for digital nomads across the globe.

The city is loaded with bistros, open-seating cafes, beach views, and stunning old architecture that offers an exquisite living experience. 

You can save a lot as the effective corporate tax is 5% after refunds, the personal income tax is 10%, and you can easily live comfortably if you make a decent income.

Getting around is easy, people are friendly, and the co-living as well as co-working real estate culture is thriving with more and more digital nomads camping in Malta.

🇬🇪 5. Tbilisi – Georgia

Territorial Tax Regime | Affordable Living | Experiences Galore

Tbilisi is the capital city of Georgia, which is also one of the best European cities for freelancers and self-employed workers.

The city is teeming with tourists, and digital nomads, and has an amazing mix of all sorts of elements that make your stay delightful. 

The income tax rate is 20% for the income generated from Georgian sources, and there is no personal income tax if your clients are foreigners. For entrepreneurs, there is no income tax till an annual income of €11,000, and 1% for companies having an annual turnover of €180.000.

Tbilisi is the gateway to all the major attractions and beautiful places in Georgia and offers different types of accommodation ranging from hostels to homestays and hotels to luxury stays.

The party culture is amazing, the cultural mix is decent, and you can enjoy the local food and produce. 

🇨🇾 6. Limassol – Cyprus

Corporate Income Tax 12.5% | Affordable Real Estate | Outdoor Activities

Cyprus ranks third on the list of the best European countries for freelancers and self-employed persons, after Luxembourg and Malta.

The country offers a safe, peaceful, and tax-friendly landscape for digital nomads from all over the globe and has a 12.5% corporate income tax.

The personal income tax rates vary for different income slabs and you don’t have to pay any tax til €19,500 annual income.

Limassol offers amazing beach views, highly affordable rentals, and real estate, and has a modern and cosmopolitan atmosphere owing to a large community of people from all over the globe. 

It offers something for everyone, ranging from horse riding to hiking on natural trails, skiing, and cycling, which makes it perfect for people who love outdoor activities.

🇷🇴 7. Timișoara – Romania

Income Tax 10% | Vibrant & Affordable Lifestyle | Excellent Infrastructure | Nightlife

Timișoara is located in the western part of Romania and is a hidden gem for freelancers, digital nomads, and self-employed in Eastern Europe.

The city has an amazing vibe to it, much thanks to the good infrastructure, excellent cuisine, affordable lifestyle, and happening nightlife. 

With co-working spaces, day trips across the entire country, moderate climate, and extremely affordable rentals of different types, Timișoara is the perfect place for you to camp or have a permanent residence. 

The personal income tax is 10% and the corporate tax is 16%.

The social contributions and other obligations are affordable and the city is teeming with diverse experiences such as yoga, zero-waste living, bicycle day trips, exciting nightlife, and delectable cuisine. 

🇭🇺 8. Budapest – Hungary

Corporate Income Tax 9% | Quality of Life | Aesthetics & Tourism

With a ton of tourist attractions, extremely affordable living and rentals, diverse experiences to explore throughout the city, and a rich cultural heritage, Budapest is one of the best European cities for freelancers and self-employed workers.

What makes it perfect for small business owners is its lucrative corporate tax rate of 9%.

Further, the personal income tax is 15% and the city offers a thriving community of digital nomads from all over the globe. While the city offers a high standard of living, it is surprisingly more affordable than most parts of Europe.

The nightlife is excellent and the city is extremely safe at all times of the day. 

Now, if you think that the tax rate of 15% is high for a freelancer, you can opt for a lump sum business expense deduction without needing to prove them.

This takes your effective income tax rate to 9%, which is one of the lowest in Europe. 

🇭🇷 9. Split – Croatia

Corporate Tax 10% | Fantastic Climate | Robust Infrastructure

Any list of the best European cities for freelancers and self-employed workers is incomplete without Split, which is one of the largest cities of Croatia. The city is rapidly becoming a hub for digital nomads owing to its lifestyle quality and attractive tax rates, especially for freelancers. 

The corporate tax rate is 10%, if you move to the country on a digital nomad visa, you dont have to pay any taxes. If you are a freelancer, you can also apply for lump sum taxation, which reduces your tax burdens to less than €1,000 for an income of €40,000. 

Split offers multiple in-country traveling opportunities and is teeming with co-working spaces with decent internet infrastructure as people from all over the world throng the city.

The city has beautiful beaches, an affordable lifestyle, and a plethora of tourist escapades to explore. 

🇧🇦 10. Tuzla – Bosnia and Herzegovina

Income Tax 10% | Beautiful Landscapes | Affordable Living 

Tuzla is one of the best European cities for freelancers and self-employed people and is becoming increasingly popular among digital nomads as well.

The city comes with an exciting backdrop in all seasons, the temperatures are tolerable as compared to the infamous European weather extremes, and the lifestyle is affordable.

Bosnia and Herzegovina levy a flat 10% income tax on both personal and business income, which makes it easier for people with limited budgets to maintain a comfortable lifestyle.

There are ample number of places to explore and you can enjoy numerous day trips from the city. 

Despite the troubled past, Bosnia and Herzegovina offers beautiful architecture, a peaceful life, and one of the best places to explore Europe as a digital nomad.

🇲🇪 11. Budva – Montenegro

Income Tax 9% | Old-World Charm | Low Business Operations Costs

Delivering a solid old-world vibe with architecture, calm beaches, and a more than welcoming community, the city of Budva in Montenegro is another good place for freelancers and self-employed.

The city has a bit of everything – luxury hotels, luxury shops, peaceful and quiet areas, bustling city centers, and ample options for tourism. 

Living in the coastal town of the Adriatic Sea comes without breaking your bank as you can easily find skilled labor for your businesses. The place is loaded with picturesque backdrops and has a low crime rate. 

The cuisine is good, much thanks to the easy availability of high-quality produce and the capital city of Podgorica is nearby.

All in all, Budva offers a complete bundle of diverse experiences at affordable prices.

🇦🇩 12. Andorra La Vella – Andorra

Lucrative Tax Rates | High-Quality Life | Scenic Places 

The city of Andorra La Vella is one of the best cities in Andorra, a country that is famous for its enticing taxation profile. The highest personal income tax rate is 10%, which is levied on income above €40,000.

For income between €24,000 and €40,000, the effective income tax rate is 5%, and 0% for income below €24,000.

Further, the corporate income tax rate is 0% for collective investment vehicles and 10% for corporations.

Andorra levies no taxes on gifts, wealth, and inheritance, making it an extremely good country for people seeking tax relief.

Andorra La Vella offers plenty of options to keep you entertained and comes with rentals and residential real estate options in all ranges. You can enjoy the best of both worlds -bustling city life, and a calm near-to-nature lifestyle. 

Go Truly Borderless With doola

Don’t let your assets and businesses back home in the US limit the countries and places you explore.

The rapid emergence of remote work culture and digital nomads has made it possible for people to make the most of their lives and aspirations. They can travel the globe, living in the most exquisite cities without having to worry about working or asset management.

However, managing everything from afar or from a different continent altogether can spur unexpected challenges, especially when it comes to tax filing and regulations.

This is where doola comes into the picture. 

doola offers a complete “business-in-a-box” service portfolio that allows you to manage all your assets and businesses in the US from any part of the world.

You can put your tax filing and compliance management on autopilot, ensure proper and timely documentation, and form new companies back in your home country from any place in the world.

doola offers a highly comprehensive Total Compliance Package, international money transfers, tax returns filing, and much more to keep you free from any concerns related to your assets and businesses back home. 

Want to know more about how we can help you make the most of your nomadic lifestyle, simply hop on a quick call today with our experts and find out!