A tax advisor who works exclusively with overseas residents says the same costly errors arise repeatedly, most of which could be prevented with straightforward planning before the move.
Living and working abroad has become more accessible than ever, with remote work removing many of the barriers that once made international relocation the preserve of a narrow group of professionals. But the ease of the move itself can mask the complexity of what follows. Financial and legal obligations in a new country are frequently misunderstood, delayed, or ignored entirely – and the consequences tend to be more serious than people anticipate.
Carl Turner, co-founder of Expat Tax Thailand, a tax advisory service for expatriates, says the mistakes he encounters are not random. They follow predictable patterns, and most could be avoided with the right preparation. “The same financial mistakes keep coming up,” he said. “It’s common for people to assume their home country’s rules still apply, or that they can figure things out later. By the time they realise something’s wrong, they’re already facing fines or complicated paperwork.”
Here are the five errors Turner sees most frequently.
1. Misreading How Tax Residency Works
The assumption that relocating abroad means your tax obligations remain anchored to your home country is one of the most widespread and expensive misconceptions in expat finance. In most jurisdictions, tax residency is determined by physical presence – specifically, the number of days spent in a country each year – rather than citizenship or permanent address.
“Expats are often unaware that spending 180 days or more in a country can trigger tax residency,” Turner said. “Once you’re a tax resident, you may owe taxes on your worldwide income in some jurisdictions.” Filing incorrectly, or failing to file at all, can result in back taxes, interest charges, and penalties that accumulate over time before anyone notices.
Turner recommends researching the residency thresholds in both the home and host country before relocating, keeping detailed travel records throughout the year, and taking professional advice early rather than retrospectively.
2. Underestimating the Risk of Double Taxation
Paying tax on the same income in two countries simultaneously is a real and avoidable risk for expats, particularly those working remotely or on a freelance basis. While bilateral tax treaties exist to prevent this, their coverage is not universal – not every country pair has a treaty in place, and those that do often contain carve-outs for specific income types.
“You might pay tax where you’re living and again where your income originates,” Turner said. The solution is not to assume a treaty covers your situation, but to verify it – and to work with a tax professional to structure income in a way that is both compliant and efficient across both jurisdictions.
3. Assuming Tax Exemptions Apply Automatically
Information about tax exemptions available to expats circulates widely and informally, and a significant number of people interpret it too broadly. Qualifying for an exemption typically requires meeting specific, documented criteria – minimum time spent abroad, maximum claim periods, or restrictions on eligible income types. Simply living overseas is rarely sufficient.
“People hear about exemptions and assume they’re covered,” Turner said. “But in most cases, you still have to file and actively claim the tax credit. Without doing so, you could face a large unexpected tax bill.” He advises verifying eligibility formally, maintaining all relevant documentation, and filing correctly from the outset rather than attempting to correct errors after the fact.
4. Treating Tax Identification Registration as Optional
In many countries, a local tax identification number is a practical prerequisite for everyday life – required to open a bank account, sign a rental agreement, or set up utility services. Despite this, Turner says a significant number of expats treat registration as something they will get around to eventually.
“Without a TIN, you may struggle to access basic services and could face penalties for not being properly registered,” he said. The registration process is generally straightforward once the correct documentation is assembled, and completing it promptly establishes a record of compliance from the start of residency.
5. Neglecting Estate and Succession Planning
Estate planning is commonly associated with significant wealth, but the intersection of two countries’ inheritance laws can create complications for anyone with assets abroad, regardless of their value. Without a will that accounts for both jurisdictions, assets can become entangled in lengthy legal disputes, or subject to tax treatment that the owner would not have chosen.
“This is the mistake people realise too late,” Turner said. “Without a will or succession plan accounting for international laws, your family could face years of legal battles.” He recommends establishing a will that is valid in both relevant countries, considering whether a trust structure is appropriate to protect specific assets, and reviewing the arrangement periodically as laws change.
The Bigger Picture
Turner’s broader point is that expat finances require a more holistic approach than annual tax compliance alone. The mistakes outlined above are not isolated errors – they interact with one another, and the consequences can extend well beyond tax bills into the ability to access healthcare, purchase property, or pass on assets to family members.
“It’s about understanding how all the pieces fit together: your residency status, your income sources, your long-term goals, and the legal systems you’re navigating,” he said. “The cost of getting it right is always less than the cost of fixing it later.”