Which country to work in? A 4 country salary comparison.

Question

Did a quick and dirty analysis to work out the impact of taxation on your overall salary and what your real income would be comparing 4 countries.

UK, USA, Japan, Hong Kong.

This set of results is based on the exchange rate as of the 12th November using a Base salary of $100,000 USD

For the USA, I also added in max 401K contributions as well as social insurance and medicare.
For the UK, National Insurance is compulsory.
In Hong Kong, MPF is compulsory.
and in Japan, Social Insurance is compulsory.

Average Monthly take home pay from a $100k USD salary =
1. Hong Kong $7134
2. Japan $6036
3. UK $5663
4. USA $5176

The main reason is the 401K. If i were to halve the 401K contribution, it would hit $5686 per month.

Therefore, if you want the same take home pay and was working in Hong Kong, you would only need a salary of ~ $70,000 USD.
Cost of living varies depending on where you live, but generally speaking, rental for all the major cities out of these 4 countries/locations are similar.

Looking forward, I also projected in for families with 2 young children. Some countries offer better tax deductions.
1. Hong Kong $220 USD per month better off
2. Japan $170 per month better off
3. USA $40 per month better off
4. UK (no change.. couldn't find any allowances for dependent children).

Tofayel · Answer

According to data, Hong Kong is the best. But I prefer Japan for their culture and life expectation. Also you should think about Canada, because their living condition, economic atmosphere and life expectation everything is good.

SlumDogEngineer · Answer

Can you post the more rigorous version of your analysis? Does this apply to any industry in particular? Thanks

tranceparent · Answer

Lets try this a little differently. Rather than expecting to be handed a more rigorous version of the analysis, how about we ask for what information and sources the OP used and his/her suggestions for creating a more thorough edition?

togafoot · Answer

Sure.. this isn't a industry vs industry comparison. More a tax system vs tax system comparison.

e.g. $100K USD salary in the USA is not the same as $100K USD in Hong Kong or Japan, or Canada or wherever.

The point is, if you were earning $80k USD in Hong Kong, you will be taking home more money after tax than earning $100K USD in New York. So when choosing a job (irrelevant of industry), the selection of country shouldn't be based on a direct gross salary expectation.

For some tax figures - https://www.worldwide-tax.com/
For Allowancs and deductions, I visited the tax sites of each country. IRS (US), Inland Revenue (UK), IMMD ( Hong Kong), MOF (Japan)

I picked these countries because I have lived in all 4 of them, and earned different amounts and always wondered what the 'real' difference in disposable income actually was as a % of gross salary

ksp · Answer

Great discussion ! !

mauriciojofre · Answer

Hi Everyone,

New to the site, so I figured I would add my two cents.

In order to have a clear picture of how much we can stretch $100k USD, we have to keep the Cost of Living (housing, transportation, food, personal care, clothes and entertainment) in mind for each one of these locations. Using the OP's take home figures we can compare these to a baseline city in terms of Quality of Life, in this example I will use New York City (USA):

1. Hong Kong $7134 (is  3% cheaper  than New York) 
2. Japan $6036 (is   36% more expensive   than New York)
3. UK $5663 (is  3% more expensive  than New York)
4. USA  $5176

So in order to have the same QOL as someone who takes a monthly salary of  $5176  in New York City, you will need this much in the other locations:

1. Hong Kong -  $5020.72  - Surplus of  USD 2113.28 
2. Japan -  $7039.36  - Deficit of  USD 1003.36 
3. UK -  $5331.28  - Surplus of  USD 331.72

*London and Tokyo were used for the UK and Japan
*expatistan. com/cost-of-living

From these estimates above we can see that Hong Kong not only lets you take home more money, but it's also the cheapest of all four locations. While Japan would force you to have a pretty limited budget. The difference with the UK is negligible.
Feel free to correct or add anything to the analysis above.

Mauricio.

3underscore · Answer

How much does a 100k job pay in HK though? I am pretty confident the job to get the number varies.

togafoot · Answer

Good stuff. I just want to verify expatisan.com data based on my own personal knowledge having lived in all 4 places.. in my case - Tokyo, Hong Kong, San Francisco & London

Expatisan uses
 Food - 
Comparisons are based on - Chicken breast, tomatoes, full fat milk, cheese, apples, potatoes, beer , coke and bread
NB: For a Western ex-pat this may be relevant as dietary habits are different compared to Easterners and this expat site will be focused on Westerners. The staples used here are not as common in Tokyo and Hong Kong... e.g. rice is cheaper and people usually have rice rather than bread or potatoes, cheese is not a common food in Tokyo and HK, and HK style cooking prefer to use meat on the bone. For HK, Pork is the cheapest meat. For Tokyo, lots of different types of fish is cheaper than in London or USA.

Eating Out is more of a norm in Tokyo and Hong Kong compared to London and USA and generally much cheaper. Fine dining is expensive in all places, but general eating out is cheaper in Tokyo and Hong Kong
Fruit is more expensive in Japan even when I lived there and the exchange rate was not as extreme, fruit was still expensive.

Housing 
Price per sq ft is the main separator.... But really, this is not a like for like comparison. Personally, I would compare it to type of housing, e.g. regular 2 bed apartment, regular 3 bedroom house etc. 
e.g. it's easier to rent a house in London and San Francisco than in Hong Kong Island, or Tokyo. It's better to compare what type of place you will likely to be living in rather than the physical size. e.g. A lot of housing design in London does not use space optimally because the buildings are very old, when compared to new apartments in Tokyo or Hong Kong.

Transportation 
This is also not a like for like comparison for likely behaviour. Buying a volkswagon golf? Most people in Hong Kong and Tokyo do not own cars. The public transport system in both of these areas are vastly better than London and New York (including the buses). Compared to San Francisco (where a car is more or less a necessity particulalrly if you are working in the valley) makes this not a like for like comparison.

My personal experience in terms of Taxis is that Tokyo and London are expensive, San Francisco is fairly cheap, and Hong Kong is the cheapest.

Most of the rest is relevant if they are staples, entertainment has some unfair comparisons 
e.g dinner for 2 in Italian restaurant... what is the price difference for dinner for 2 in a Sushi restaurant?
e.g. You are expected to tip in the USA and UK, no tipping culture in HK and Japan. 
e.g. Cappucino in expat area for coffee .. what about drink from a place locals would go to?

Lifestyle 
One thing that comes down to, although this is a more 'scientific' way to measure likely spend. Behaviour often changes based on where you live.

If you plan on living a purely expat lifestyle, it becomes more relevant (except for the housing). One thing I found is my lifetsyle modified based on where I lived.
San Francisco - More home cooking, needed a car, even for entertainment needed a car to go anywhere, clothes were cheap, supermarkets were cheap, restaurants expensive (the tips!!! Arrggghhh), renting is freaking expensive because there isn't much to cater for someone out there by themselves. Co sharing is ok, but the minimum rent is quite high

London - Similar to SFO except that public transport is a million times better. Did not need a car at all. Drinking (pubs) is cheaper. Rental, I found to be cheaper than SFO unless you live in the super expensive areas!

Tokyo - More variety of rental prices. You can get very very small places for cheap, but prices spread out quite quickly. Eating out is cheap.. just eat local, not Western. Public Transport is even better than London and about the same price, again, no need for a car. Drinking can be cheap if you visit local bars rather than going to expat bars.

Hong Kong - Rental I find is most expensive. It's very difficult to find somewhere a single person or couple can live at unless you move far away from public transport. Public transport is great and very cheap. Eating out is cheapest in Hong Kong. Drinking is expensive.

Currently, Tokyo will get you the most unrealistic salary. The exchange rate is  insane . Based on the current exchange rate, my pre MBA salary is higher than the average salaries of post MBA graduates from tier 1 schools in the USA when converted to USD. That wasn't the case a few years ago (it was 120Y to 1 USD when I was there, it's currently around 77). Therefore a post-MBA salary in Tokyo will now be insanely high... except that Tokyo is not a traditional MBA recruiting ground.

Hong Kong pays less, there seems to be more of a 2 tier-system here. Finance and non-finance. Finance jobs tend to pay much higher than all other industries here by a long margin. Finance jobs will likely pay the same as USA rates. Non- finance jobs will pay lower.

Tokyo - Not an MBA hunting ground, generally speaking, pay is based on experience rather than ability.

MYCambridge · Answer

What about Singapore?

AN225 · Answer

Yes, someone expert please describe pros and cons of working in Singapore.

rhyme · Answer

Its hot. Always.

vgutsc · Answer

The big question here is Are you a US citizen or Greencard holder?? If you are, then regardless where you go in the world, you need to file and pay taxes in the US on your world wide income (at the US tax rates). With the current exchange of information in countries, the IRS can caught up on ppl try to evade taxes pretty quickly...AND in the upcoming years, there are more filing requirements in the US on disclosure and reporting of foriegn bank accounts. May not have tax impact but significant penalty if failed to do so.

p.s. UAE or some south carribean country (i.e. Bahamas) has 0% income tax

p.s. UAE or some south carribean country (i.e. Bahamas) has 0% income tax

abhi47 · Answer

very very useful post. Thanks a lot for sharing. +1 kudos from me.

togafoot · Answer

Sometimes it's wet... but still hot :lol:

duffyrico · Answer

NICE FORUM POSTING....

How much does a 100k job pay in HK though? I am pretty confident the job to get the number varies.

BY 
salarydom

elitebag · Answer

It just depends on which place you like and also the salary is important.

Anonym · Answer

Some rough calculation for Singapore turns out roughly to be $6600 per month..

GreginChicago · Answer

This is a pertinent observation.

I would add that comparing amount of taxes without the benefits they are providing is limited.
Take a US vs France comparison:
* unemployment benefits differs (well, they exist in France...)
* health insurance is a different system all together
* retirement doesn't work the same

Finally, and since we are working about work visas - they are not free!

Which country to work in? A 4 country salary comparison.

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