Geoarbitrage Strategies For Entrepreneurs and Investors

In this article we look at how entrepreneurs, investors and high-net-worth individuals can take advantage of geoarbitrage strategies to maximise value, minimise taxes and also enjoy a best-of-both-worlds lifestyle. 

We first look at what geoarbitrage means, how it works, and how you can benefit from it.

We then move to Europe, home to the world’s highest concentration of geoarbitrage opportunities before exploring others in Asia and the Americas. Finally, we look at some geoarbitrage challenges, so you know what to be aware of. 

Geoarbitrage And The Wealthy

Monaco is an enticing destination for the wealthy. 

It has warm weather, excellent services, 0% income tax and no capital gains. 

Plus, there’s an aura of glamour to the place too, epitomised by its annual Formula 1 race. 

And yet, if you speak to residents of the tiny Principality, you will notice a recurring trend.

The majority of residents of Monaco also have houses on the French or Italian Riviera.

So, despite living in a warm welcoming, tax-efficient jurisdiction, they prefer to spend their weekends elsewhere, where there is more space and lower prices. 

This is an example of geoarbitrage. 

It’s a term which has its roots in the digital nomad movement, but increasingly, it’s also become a strategy used by the wealthy to maximise the quality of their lives. 

What Is Geoarbitrage?

Geoarbitrage is a strategy whereby you take advantage of cost of living differences between different geographical locations. 

The word is a portmanteau of the words geographic and arbitrage, the process whereby you leverage the price differential between different markets to make a profit.   

It’s a key component of business and trade too, you buy low, sell high, then pocket the difference. It’s also why companies offshore their manufacturing and other business processes to help them reduce costs. 

The term geoarbitrage is generally attributed to Tim Ferriss, author of the bestselling lifestyle book, The 4-Hour Workweek.

In it, he discusses the practice of earning high income from one country, while living in significantly cheaper countries.  

Ferris’ book proved hugely influential and helped popularise the digital nomad movement followings its publication in 2007.  

Since then, high-net worth individuals have adapted the principals of geoarbitrage as a way of enhancing their overall autonomy. 

The wealthy are always looking to maximise value. So, despite their larger incomes, cost of living remains a factor while quality of living is equally, if not more, important. 

And, as we’ll see, the cost and lifestyle benefits of geoarbitrage can also be combined with tax reduction strategies and offshore business formation to form a complete global mobility strategy. 

Benefits Of Geoarbitrage

The benefits of geoarbitrage are mainly cost-based, allowing you to earn more and spend less. 

From a HNWI perspective, there is also a tax dimension, be that a reduction in personal income tax by living in a low-tax jurisdiction, or lower operating costs by incorporating a business there. 

Geoarbitrage, therefore, offers all the benefits of global mobility in a highly localised form, with minimal time spent on travel. 

The History of Geoarbitrage

Though the phrase tends to be associated with remote working, and was popularised in the noughties, the basic concept behind geoarbitrage is as old as history itself. 

Because when you get right down to it, humans are no different to any other creature on this planet – we go where it’s abundant. 

Our prehistoric ancestors sought shelter and security in caves but went hunting and foraging elsewhere. 

The invention of farming tied many to the land, but even today we still have nomadic tribes who migrate overland with their livestock. 

As agriculture grew, cities grew and trade grew. Later came the sailing ships and the trade caravans, transporting exotic goods over great distances to sell then bringing the profits back home.

The industrial revolution triggered mass migration away from rural areas and into cities. 

But as the cities grew more crowded, living there became more expensive. Meanwhile cars became cheaper, ushering in the age of the commuter. 

For a majority of people, travelling long distances to work is literally just another day in the office. 

For many Americans it’s normal to cross state lines, to jobs that pay higher then back to their home state where living is cheaper. 

And then there’s the Canadian city of Windsor, Ontario. Located directly across the river border from Detroit, its proximity to the heart of the US motor industry brought thousands of Canadians crossing daily for work. Conversely, a large number of American auto workers took up residence in Canada. 

This cross-border symbiosis has been in decline for years and is now, hollowed out post-Covid and further threatened by tariffs – a clear lesson in how geoarbitrage opportunities can threatened by changes in the political climate.

Geoarbitrage Trends In Europe

In Europe, meanwhile, where trade is more open and borders are more fluid, cross-country commutes are far more common. 

Indeed, many of the European countries on this list are unable to function without importing labour and pay comparatively higher wages as a result.

So, while wealthy residents of Monaco move out on the weekend, on weekdays the Principality imports thousands of workers from neighbouring France and Italy. 

French and Italian workers also join up with Germans and Austrians on the daily commute to Switzerland. 

And then there’s tiny Luxembourg, another popular destination for French workers, along with Belgians and Germans. 

Further away, on the tip of the Iberian Peninsula, we have the British overseas territory of Gibraltar, which imports around 15,000 workers daily, the majority of them Spanish. 

Notice a trend? 

They’re all major financial centres – small in size, but big in capital. 

And they’re all dependent on, and adjacent to, high-tax countries with far cheaper property and overall living costs.  

No doubt you’ve already begun to sense an opportunity here, so now let’s explore how you can take advantage. 

How Geoarbitrage Works

Geoarbitrage works by earning a high income in one location while living in a much affordable one. This is the default version, but then we have the advanced version for high-net worth individuals. 

For HNWIs, three geoarbitrage tactics apply. 

1. Earn in high cost, live in low cost (a.k.a. geoarbitrage the basic version).
2. Spend in high-tax/low-cost, live in low-tax, high-cost (the tax-reduction tactic).
3. Incorporate in low-tax, live in high-tax (the business founder tactic).

The first tactic we’ve covered already, it’s geoarbitrage 101. 

The tax reduction tactic involves you living in a low-tax jurisdiction while spending more of your time and money over the border.

The basic rule of thumb being, low-tax jurisdictions tend to be tiny, expensive, and limited in scope.

When you’re not working it makes sense to go where you’ve got a lot more to do and a lot more space to do it in. And for a lot cheaper too. 

Entrepreneurs, however, may decide to invert this, so instead of living in a low-tax country they incorporate their business there. 

By living in a high-tax jurisdiction they don’t get any personal tax benefits, but they do get to preside over a far more profitable business, with low running costs and a more favourable rate of corporation tax to match. 

Choosing The Right Geoarbitrage Location

So, what constitutes a good geoarbitrage location? And which countries should you look at?

To answer the first question, a good geoarbitrage location combines the following key factors:

Financial: Significant differences in cost, wages, taxes to arbitrage between countries.

Lifestyle: The location should be a place where you want to leave in, or very near to it.

Proximity: Ideally there should be as short a distance as possible between point A and B with a minimal commute time and a friction-free border. 

Flexibility: An A-to-B border crossing is great, but a triple border is better because you have more options.

The financial and lifestyle factors are self-explanatory, though proximity and flexibility are worth expanding on for the sake of clarity. 

In terms of proximity, Sweden and Norway share a convenient border, but since both countries share the same red flag attributes (high income, high tax, high cost of living), Scandinavia is a poor geoarbitrage location. 

In terms of flexibility, having multiple borders in close proximity is desirable, but only if those borders are readily accessible (and also meet the lifestyle criteria of point two.)

So, while Colombia, Brazil and Peru share a triple border, the border region consists of small, isolated towns in the Amazon, which is a far cry from the Riviera. 

Europe, on the other hand, offers plenty of geoarbitrage locations scoring high on both proximity and flexibility.

Monaco is minutes away from both Italy and France, while Switzerland boasts a quintuple border with Italy, France, Germany, Austria, and Liechtenstein. 

Finding Geoarbitrage Opportunities

Once you understand the basics, you’ll start to realise there are geoarbitrage opportunities everywhere. 

And you will start applying this type of thinking to everything. 

Let’s start with a pain point that affects billions worldwide, and that’s healthcare. 

While medical science is advancing at an unprecedented rate, the standard of healthcare is deteriorating in many Western nations. 

Next to cost of living concerns, it’s one of the main reasons why people are now leaving the US permanently to live in Europe. 

Geoarbitrage means your healthcare is no longer dependent on one location, or even one nation, maximising your chances of receiving the best care available. 

It’s the same with education, whether you’re exploring schooling options for young children, or universities for children of college age. 

And while millions rely on geoarbitrage strategies for work, retirees also take advantage by living in sunnier climes where their pension money stretches significantly further. 

But since you’re not quite ready to retire just yet, let’s focus on what truly matters, your investments. 

Previously we’ve spoken about tax both personal and corporate, though another major consideration for entrepreneurs, beside tax, is talent. 

So, by leveraging geoarbitrage strategy, you may opt to live in one location (location A) and establish a business in another, which is more tax efficient (location B). 

Only problem is, you’re not a fan of location B’s workforce. 

No problem. 

Because those guys over there in location C have a superior work ethic, they speak better English, and most importantly, they understand how you communicate and they get the job done. Those guys get it.

So now you have a triple geoarbitrage situation, you live in one location, your primary business is located in a tax-friendly jurisdiction, but you also have another service-based entity in a third jurisdiction taking full advantage of its native talent.  

And because, you’re applying the principals of geoarbitrage, all three locations are just a short commute away. 

Strategic Geoarbitrage in Europe: Live The High Life But With Low-Tax Residency 

Europe currently offers the highest concentration of geoarbitrage opportunities in the world, so it makes sense to start there. 

The primary advantage here is freedom of movement from one country to the next. 

Secondly, as you will see, Europe is home some of the world’s largest economies, as well as some of its tiniest tax havens, making for some interesting geoarbitrage options, such as:

• Switzerland – 5 borders 
• Monaco – 2 borders 
• Luxembourg – 3 borders 
• Liechtenstein – 2 borders 
• Andorra – 2 borders
• Gibraltar – 1 border 

This list is by no means exhaustive, rather the examples here are designed to get you thinking of the possibilities. 

Consider them off-the-shelf solutions, rather than the bespoke lifestyle Blueprint service we offer our clients. 

Switzerland: The Classic Option

Switzerland is the largest country on our list and, with five borders, also has the highest number of direct neighbours. 

While living in Switzerland you have plenty of space and fresh Alpine air, though you also have the option of driving across the border into Germany, France, Italy, or Austria. 

And let’s not forget little Liechtenstein, another country on our list we’ll be talking about shortly. 

Switzerland has a long-standing reputation for banking dating back to the 18th century. It may not be the preeminent HNWI hub it used to be, but its location, right at the beating heart of Europe, ensures its continued viability. 

So, although we tend to favour jurisdictions like Singapore and Dubai, none can’t compete with Switzerland on proximity and flexibility. 

As a geoarbitrage location, Switzerland scores high on all fronts. So here are three options, hand-picked by Jeremy:

Jeremy’s Picks:

• Live in Lugano, enjoy Milano, Italy (77.9km / 48.4mi)
• Live in Geneva, enjoy Lyon, France (149km / 92.5mi)
• Live in Zürich, enjoy Konstanz, Germany (70.4km/43.7mi)

Monaco: The Riviera Lifestyle

The Principality of Monaco has been a popular destination for the wealthy since the 19th century.

Combining old world glamour with zero personal income tax, Monaco remains an attractive destination for HNWIs.

Though not in the EU, Monaco enjoys freedom of movement within the European Schengen Area thanks to its customs union with France. 

Similarly, Monaco is not a member of the Eurozone, though it still uses the Euro as its official currency.  

As with many similar microstates on this list, Monaco is small, often cramped and quite expensive. 

That disadvantage is easily offset, however, given Monaco’s position on the Côte d’Azur (French Riviera).

Jeremy’s Picks: Live in Monaco, spend in Nice, France and Bordighera, Italy.

Luxembourg: The Benelux Option

The Grand Duchy of Luxembourg is one of the oldest EU members, having joined the union back in 1958. 

It also hosts several of the EU’s largest institutions, such as the Court of Justice of the European Union. 

Together with Belgium and the Netherlands, Luxembourg forms the Benelux countries, the three small countries at the heart of continental Europe. 

Luxembourg shares land borders with Belgium, Germany, and France, making it an ideal central location for European operations. 

With a progressive personal income tax rate rising to 42% for high earners, Luxembourg is far from ideal from a tax perspective. 

Nonetheless, the country remains popular with investors due to its banking system and overall economic stability. 

Jeremy’s Pick: Live in Luxembourg, spend in France, Belgium, or Germany.

San Marino: An Alternative To La Dolce Vita

San Marino is one of the world’s smallest countries but differs from other European microstates in that it is a republic. 

San Marino is not an EU member however its customs union with Europe allows free movement. It’s also not in the Eurozone but still uses the Euro as its official currency.

While not a true tax haven, San Marino does offer some tax advantages over neighbouring Italy. It’s also a quiet, safe, and secure place to live.

Jeremy’s Pick: Live in San Marino, spend in Rimini, Italy (28.4km / 17.6mi)

Liechtenstein: The Alpine Option

Liechtenstein is the second principality on our list and one of the smallest countries in Europe. 

It’s an alpine country, nestled between Switzerland to the west and Austria to the east. 

As such, it’s popular with winter sports enthusiasts, but more so with HNWIs who take advantage of the country’s favourable taxes. 

The country has a customs union with Switzerland and so uses the Swiss Franc as its official currency. 

Jeremy’s Pick: Live in Liechtenstein, spend time in Villach, Austria.

Andorra: The Double Catalonian Option

Located high in the Pyrenees between France and Spain, the Principality of Andorra is another popular winter sports destination though, once again, the primary draw is its low taxes. 

In addition to having a low rate of VAT (value added tax) and a corporate tax rate of just 10%, it also has a low income tax rate of 10% for income over €40,000 (income under this is taxed at 5% or 0% for income less than €24,000.)

As with Monaco and San Marino, Andorra is not an EU member state or a member of the Eurozone, though it nonetheless enjoys similar freedom of movement though a customs union with the EU and uses the Euro as its official currency. 

Much like the nearby Spanish region of Catalonia, Andorra’s official language is Catalan.

Indeed, Catalonia is the perfect place to go when you fancy a change of pace. 

While Andorra offers some of the freshest air in Europe it’s not exactly the liveliest place in the world, but luckily Barcelona is less than three hours away. 

Jeremy’s Pick: Live in Andorra, spend time in Barcelona (192km / 119mi)

Gibraltar: A Rocky Road Towards Freer Borders

Gibraltar is a low tax jurisdiction with no capital gains, wealth tax, inheritance tax, or VAT. 

It is a Mediterranean country at southern tip of the Iberian Peninsula, bordering Spain and a short commute from popular Costa Del Sol destinations such as Marbella and Malaga.  

On paper all of this should make Gibraltar a perfect geoarbitrage location, though border complications make this one a work in progress. 

As a British Overseas Territory, Gibraltar differs from others on this list since, although Gibraltar has full domestic autonomy, all its foreign policy is brokered by the UK. 

To date, the primary focus of this foreign policy has involved the territory’s relationship with its neighbour. 

Spain and Gibraltar have a historically fraught, yet nonetheless symbiotic relationship based on mutual necessity.

Gibraltar has huge wealth but limited space, no natural resources, and a tiny population. It needs to import labour to function. 

Neighbouring Andalucía is the second largest region in the country and is rich in resources but has some of the worst unemployment in Spain. 

Every day thousands of workers cross the border to work in Gibraltar but there’s a problem.

Until recently the status of Gibraltar has been something of an afterthought post-Brexit, leaving those workers in limbo while long delays at the border have become a common occurrence.  

In June 2025, all parties reached a historic agreement which would remove checks and controls at the border without requiring Gibraltar to join Schengen free travel area or be subject to the EU’s Entry/Exit (EES) system. 

The finer details are still being worked out, however, and the agreement has yet to be ratified, but all parties are eager for a deal making Gibraltar one to watch for 2026. 

European Geoarbitrage: Corporate Benefits

In all of the above examples, we looked at living in one location and escaping to another. 

But the best part about it is, they can also be reversed from a company formation perspective, allowing you to live in one location and enjoy a lower corporate tax rate in another. 

Many of the above examples are short commutes, ranging from ten to 30 minutes, such as Monaco-Nice or San Marino-Rimini, which can be done even multiple times a week. 

Others are longer, like Andorra-Barcelona, and so are more suited to a monthly or bi-monthly getaway. 

All offer significant savings compared to constant international travel and, by significantly reducing air travel, there’s a clear environmental benefit too.

What’s more, these European geoarbitrage strategies allow you to implement flag theory in a tighter geographical radius, while maintaining personal your sovereignty. 

In many of these destinations, the borders are quite porous, allowing one much more mobility when entering and exiting jurisdictions in comparison to taking international flights. 

In fact, in many cases you can literally walk across the border with little to no migration control (even though technically some of these are non-Schengen to Schengen).

More Global Geoarbitrage Strategies

So far we have focussed on Europe, simply because it has the highest concentration of geoarbitrage opportunities anywhere. 

Though Europe is hardly the only part of the world where you can enjoy the benefits of geoarbitrage, so let’s look at two more regions next, the Americas and Asia. 

Geoarbitrage in the Americas

Increased living costs, coupled with a growing dissatisfaction with leadership, has resulted in a growing number of US and Canadian citizens moving abroad. 

While North/South migration has been a reality for decades, remote working opportunities means it’s now easier than ever to take advantage of the lower living costs and higher temperatures Latin America has to offer. 

One popular option is to reside in Mexico, where it’s cheaper, but commute to the US for business. 

Or you may decide to live in Montevideo, Uruguay, and enjoy exemptions on foreign income, but also all the best that Buenos Aires has to offer. (Just two hours away by ferry.)

Or you could flip it and incorporate a business in Uruguay commute on occasion to conduct essential business but spend most of your time enjoying Argentina. 

Jeremy’s Picks:

• Montevideo/Buenos Aires: Live in Montevideo spend time in Buenos Aires (2 hours by ferry)
• San Diego/Tijuana: One of the most popular borders in the world. Live in Mexico with a fraction of the US cost but have easy and quick access to the US. (27.6 km / 17.2 mi)

Geoarbitrage in Asia

As regular readers know, two of our favourite countries in Asia are Malaysia and Singapore. 

And, as you’ve no doubt already guessed, the cost of living difference between Malaysia and Singapore is significant. 

This makes it a perfect geoarbitrage combo whereby you live in the world-class city state of Singapore, enjoying all its tax benefits, while receiving excellent value for money while spending your time in Malaysia. 

Once again, you can flip it, especially since the cost of living in Singapore is high. So instead, you may prefer to live in Malaysia and incorporate your business in Singapore instead. 

Geoarbitrage Challenges

By now you should be well aware of the benefits of geoarbitrage, but must also be wary of the pitfalls which often catch out the unprepared.

The most common one is not understanding the ins and outs of tax residency. 

The standard rule of thumb is that, once you reside in a country for over 183 days, you become tax resident there. 

It’s a nice, neat, and simple explanation – except international tax law is anything but that.  

In truth, there are additional factors which also come into play when helping to determine your tax residency which can vary from country to country, and, since legislation is constantly changing. You need to be on top of these to avoid getting caught out, especially when it comes to countries with no double taxation treaties. 

In addition to local laws, geopolitics also plays a part. From Detroit to Gibraltar, your bailey to cross borders to work and do business remains at the mercy of political parties who can tighten or loosen controls on a whim.  

And, as Covid also proved, borders can also be shut down completely without warning. 

Next, we have banking challenges, such as compliance hurdles or foreign currency payment issues. For US citizens the level of difficulty increases as banks are often reluctant to accept US persons due to the additional compliance headaches of FATCA. 

For these reasons and more, it’s always a good idea to have some professionals on the ground you can rely on for the right advice. 

Becoming a Millionaire Migrant client means you’re automatically plugged into our network of professionals around the world with access to the most up-to-the-minute information. 

Geoarbitrage: Key Points

• While the principals of Geoarbitrage pre-date the industrial era, the practice did not truly become viable until the advent of motorised transport. 

• The growth of remote working has since pushed geoarbitrage into the mainstream, popularised by writers such as Tim Ferriss. 

• HNWIs can also benefit from geoarbitrage principals by living in low tax countries while spending time in cheaper, more spacious ones.

• Conversely, they may choose to live in cheaper countries but incorporate in tax-friendly countries. 

• Europe has the largest concentration of geoarbitrage opportunities, though others exist in the Americas and Asia. 

• While geoarbitrage offers numerous benefits there are pitfalls to be wary of, particularly when it comes to tax residency – emphasising the need for expert advice. 

Geoarbitrage: Conclusion

To reiterate, this article is more of a thought experiment than anything. 

Yes, the examples we provided are real – as you read these words people are living this reality right now – but that does not necessarily mean their life will work for you. 

Our intent, instead, is to get you thinking about all the lifestyle design and financial benefits which geoarbitrage has to offer. 

We know from experience that, once your mind is open to these types of opportunities, you will begin to see them everywhere. 

Millionaire Migrant was founded on the principle that better opportunities are out there, for those who are willing to explore them. 

Going it alone can be time consuming and costly, so leverage our experience to reach your destination faster.

We handle the headaches so you enjoy only the benefits. 

Geoarbitrage FAQs 

What is geoarbitrage?

Geoarbitrage involves taking advantage of the price differential between two locations, for example by earning a high income in one country while living in a second, cheaper one. 

Investors can also take advantage by living in a low-tax jurisdiction while spending their time in neighbouring countries where the cost of living is cheaper. 

Alternatively, they may decide to live in a cheap country and pay higher personal income taxes, but incorporate their business in a low-tax jurisdiction and pay a much lower rate of corporate income tax. 

Where are the best geoarbitrage countries?

While geoarbitrage opportunities also exist in Asia and the Americas, the best geoarbitrage countries exist in Europe. This is because the European Union offers freedom movement across its borders as well as customs unions with tax-friendly microstates like Monaco and Andorra. 

What is the Schengen Area?

Located in Europe, the Schengen Area is the world’s largest free travel zone providing freedom of movement to approximately 450 million people.

It’s named for the town of Schengen in Luxembourg, where the original agreement was signed in 1985.

There are currently 29 countries in the Schengen agreement, including 25 of the 27 EU member states, plus Switzerland, Liechtenstein, Norway, and Iceland.

The two EU countries not currently in Schengen are Ireland and Cyprus.

Ireland is instead a member of the Common Travel Area, which allows freedom of movement between Ireland and the UK.

Cyprus is currently inadmissible due to political division and the contested status of the northern part of the island, which has been under Turkish control since 1974.