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Geo-Arbitrage for Software Engineers: Earn Western Salaries, Live in Low-Cost Europe

Geo arbitrage for software engineers in Europe: how to earn Western remote salaries while living in low-cost countries. Taxes, visas, cities, risks, and strategies.

The European Engineer

January 27, 2026

15 min read

Geo-arbitrage for software engineers in Europe is no longer a weird digital nomad fantasy. It’s a very real, very effective way to:

Keep a remote salary from a high-paying market
While living in a much cheaper European city
And banking the difference as savings, investments, or runway for your own projects 💰

If you’re looking for a “earn more spend less developer” strategy that doesn’t involve moving to Bali, this one’s for you.

Explore 5,000+ remote and on-site tech jobs →

What Is Geo-Arbitrage for Software Engineers in Europe?

Let’s define it clearly.

Geo-arbitrage for a software engineer in Europe means:

Getting paid like you live in a high-cost market (e.g. London, Zurich, Amsterdam)
while actually living in a lower-cost European city (e.g. Bucharest, Warsaw, Belgrade).

It’s essentially location arbitrage for programmers: arbitraging the gap between where your employer is and where your apartment and grocery bill are.

Typical scenario:

Employer: US, UK, DE, NL, CH
Contract: Remote (often “Europe time zones”)
Your location: Lower cost-of-living EU/EEA/EFTA or nearby
Result: Same or similar pay, drastically lower expenses

This is especially interesting if you’re on a fully-remote salary in a low-cost country in Europe, or you’re currently in a high-cost European city and wondering if it’s worth relocating.

How Much Can You Actually Save? (Numbers, Not Vibes)

Based on recent data from 31 European cities and 20 countries (salary submissions from software engineers), here are annual saving potentials when you keep a strong remote salary and optimise for cost of living.

⚠️ For cities with fewer than 20 submissions, treat numbers as early indicators, not gospel.

Top Geo-Arbitrage Destinations (Savings per Year)

These estimates assume you’re on a remote salary pegged to a higher-paying market, then compare typical expenses in each city.

City & Country	Estimated Extra Savings / Year	Data Quality
London, UK	€47,857	✅ 38 submissions
Zurich, Switzerland	€47,041	✅ 38 submissions
Bucharest, Romania	€39,364	⚠️ 11 submissions (limited)
Warsaw, Poland	€34,431	✅ 24 submissions
Brussels, Belgium	€29,800	⚠️ 5 submissions (very limited)

Let’s unpack this, because some of it looks counterintuitive.

Wait, why are London and Zurich on this list?

Because there are two kinds of geo-arbitrage:

Classic model – high-paying remote job, live in a low-cost city
- Example: Getting a UK/US-level salary while living in Bucharest or Belgrade.
- You win on housing, food, services, everything.
Intra-country model – take advantage of internal differences
- Example: Working for a London-based company, but living somewhere in the UK with much cheaper rent.
- Same for Zurich vs. elsewhere in Switzerland.
- Your “city” in the data may be London/Zurich (employer market), but your actual rent is lower → arbitrage.

The big takeaway:
Being tied to the salary band of a high-cost city is often more important than where your couch actually is.

See full country & city rankings →

The Core Strategy: How to Actually Do Geo-Arbitrage (Step-by-Step)

Let’s walk through a practical blueprint for geo arbitrage as a software engineer in Europe.

1. Get Yourself a High-Market Remote Salary First

Geo-arbitrage only works if you anchor your income to a high-paying market.

Rough ballpark for 5–8 years experience:

Market (Employer Base)	Typical Mid/Senior Total Comp (€/year)
Zurich / Swiss	€140k–220k+
London / UK	€90k–160k+ (incl. bonus, stock)
Amsterdam / NL	€80k–140k
Berlin / DE	€70k–120k
US remote to Europe	€120k–250k+ (company dependent)

Compare that to local salaries in cheaper European markets:

City	Typical Mid/Senior Local Salary (€/year)
Bucharest	€35k–70k
Warsaw	€40k–80k
Belgrade	€25k–60k
Sofia	€30k–65k
Krakow	€35k–75k

You can see why “remote salary low cost country Europe” is a powerful combo.

Where to find geo-arbitrage-friendly jobs

Look for roles that specify things like:

“Remote, Europe time zones”
“Remote within CET–EET”
“Remote from EU/EEA/UK”
“Location-flexible in Europe”

Good hunting grounds:

Explore jobs → – filter by “Remote” and “Europe”
US startups hiring in Europe: YC job board, Wellfound/AngelList
Remote-first companies: GitLab, Automattic, Remote, Doist, etc.
Scale-ups in NL/DE/UK that allow EU-remote: many are now hybrid/remote-friendly

Pro tip:
On your CV and LinkedIn, use “Based in Europe (willing to relocate/remote)” instead of locking yourself into a low-cost-country label that might anchor offers down.

2. Pick Your Geo-Arbitrage Base: Where to Actually Live

Now the fun part: where do you move to earn more, spend less as a developer?

Best Geo-Arbitrage Cities (with Caveats)

Using the saving estimates + local cost-of-living and sample sizes:

City	Why It’s Attractive	Watch Out For
Bucharest 🇷🇴	Very low rents, strong tech scene, EU member; ~€39k/year potential savings (limited data)	Infrastructure outside core areas, bureaucracy, tax changes
Warsaw 🇵🇱	Modern, good salaries if local, low-ish costs; ~€34k/year savings	Winters, Polish bureaucracy, language barrier
Belgrade 🇷🇸	Non-EU but popular base, low cost, good dev community	Non-EU residence, banking, client comfort with Serbia
Brussels 🇧🇪	Odd one: EU/bureaucrat city, high salaries relative to rent; ~€29.8k (very limited data)	Small sample size, tax heavy, not truly “cheap”
Hamburg 🇩🇪	Similar arbitrage if working for Berlin/Munich salaries	Data limited (9 submissions), Germany’s complex tax system
Top cities overall	Brussels, Hamburg, Bucharest, Belgrade, London appear near top of rankings	Some are employer markets, not cheap-living markets

⚠️ Remember: Brussels, Hamburg, Bucharest have limited sample sizes (<20 submissions). Use this as directional info, not a perfect ranking.

From a pure geo-arbitrage perspective, I’d rank for remote workers:

Bucharest – EU, low cost, solid infrastructure, good internet
Warsaw – slightly higher cost, but still very efficient vs Western salaries
Belgrade – if you’re OK with non-EU admin and want very low cost
Smaller cities in these countries (Cluj, Timisoara, Gdansk, Novi Sad) – even cheaper if you don’t care about capital-city life

3. Taxes: The Boring Thing That Can Destroy Your Arbitrage

Geo-arbitrage is not just “cheap rent, yay”. Tax residency will make or break your strategy.

The basic rules (simplified, but directionally right)

In Europe, you’re usually tax-resident where:
- You spend >183 days/year, or
- Your “centre of vital interests” is (home, family, etc.)
Your employer’s country (e.g. UK, US, NL) may still:
- Withhold some taxes
- Need a legal entity/PEO in your country
- Treat you as a contractor instead of employee

Three common setups for geo-arbitrage engineers

Employee with local payroll solution
- Company uses Deel, Remote, Oyster, etc.
- You’re a legal employee in your country of residence.
- Pros: Simple, benefits, clear social security.
- Cons: Your salary may be localised down once they know you’re in a cheap market.
Contractor / freelancer (B2B)
- You set up a sole trader or company (e.g. Romania SRL, Polish JDG, etc.).
- Bill your remote employer in EUR/USD.
- Pros: Often best for location arbitrage for programmers. You can choose low-tax structures.
- Cons: Admin, accounting, potential instability, harder to get mortgages.
“Don’t tell anyone I moved”
- You move country but stay on the old payroll.
- Very common, very risky once you go beyond ~3–6 months.
- You can trigger permanent establishment issues for your employer, double taxation, fines.

I’m not your tax advisor, but here’s what I’d actually do:

Before moving:
- Talk to a local accountant in your target country
- Ask explicitly:
  - “If I earn €X/year as a foreign contractor/employee, what’s my effective tax rate?”
  - “Is there a favourable regime for foreign remote workers / IT / startups?”
Countries like Portugal (NHR, though being wound down), Cyprus, sometimes Romania/Poland for IT, and some Eastern European setups can bring effective tax down into the 10–25% range if structured well.

One of the main geo-arbitrage levers is not just rent — it’s tax optimisation within legal frameworks.

4. Will Your Career Suffer If You Do This?

This is the part nobody on Reddit wants to talk about.

Yes, geo-arbitrage can hurt your career if you do it wrong.

The risks

Employers localise pay:
- “Oh, you’re in Romania now? Let’s ‘align to the local market’.”
- Suddenly your €110k London salary becomes a €55k Bucharest salary.
You become “out of sight, out of mind”:
- Less visibility → fewer promotions.
- Especially in hybrid teams where leadership is in one city.
Future employers judge the CV:
- If you only work for low-prestige companies from cheap locations for 5+ years, your profile can stagnate.

How to avoid shooting your future self in the foot

Anchor your compensation to the high-market location and keep it that way.
- If they want to adjust for your new location, consider walking.
- Many companies pay “zone-based” (e.g. US/EU/ROW). Aim to stay in the “EU high” zone.
Stick to brand-name or strong engineering orgs if possible.
- A FANG/MANGO/FAANG-style or top-tier startup name on your CV beats an extra 10% savings.
Stay visible:
- Present internally, lead projects, over-communicate.
- Visit HQ once or twice a year; in Europe that’s cheap and easy.
Keep your skills and network “market-ready”:
- Don’t slip into local-market complacency just because your rent is €400/month.
- Attend major conferences (Berlin, Amsterdam, London).
- Contribute to OSS, speak at meetups, keep your LinkedIn alive.

If you treat geo-arbitrage as a temporary financial accelerator (3–7 years) rather than a permanent exile from the main tech hubs, you can have both: fat savings and strong career growth.

Concrete Example: How the Numbers Play Out

Let’s run a rough scenario for a senior engineer, showing why “geo arbitrage software engineer Europe” is such a hot strategy.

Scenario A: Live and work in London

Gross salary: €120,000
Net after tax/NI: ~€78,000 (approx, depends on details)
Annual living costs (rent, food, transport, etc.): €55,000
Net savings: €23,000 / year

Scenario B: Get paid London rates, live in Bucharest

Assuming you somehow keep the same gross (this is the key bit):

Gross salary: €120,000 (remote contract, London-based company)
Net after local tax: varies wildly by structure, but let’s say ~€84,000 net with decent optimisation
Annual living costs in Bucharest: €30,000–35,000 for a very comfortable life
Net savings: €49,000–54,000 / year

Difference: ~€26,000–31,000 extra savings per year.

The dataset suggests €39,364/year potential savings for Bucharest in some scenarios – that’s probably assuming even cheaper lifestyle or better tax structure. But you can see the order of magnitude.

Do this for 5 years and it’s:

London lifestyle: ~€115k saved
London-pay-in-Bucharest lifestyle: ~€250k saved

That’s a 6-figure difference just for moving your body eastwards and keeping your compensation anchored westwards.

Social & Lifestyle Considerations (aka: Will You Be Miserable?)

Geo-arbitrage is not just a spreadsheet game. You’re moving your actual life.

Things to think about:

1. Integration & language

In Warsaw or Bucharest, you can get by in English in tech circles, but:
- Bureaucracy, doctors, government websites → local language.
Learning basics of the language massively improves quality of life.

2. Dating, friendships, community

If you move alone, build a deliberate social life:
- Coworking spaces
- Tech meetups
- Language exchanges
- Hobby groups (climbing, dance, sports)

The worst-case: you become that isolated remote engineer, increasing your savings while your mental health collapses. Not worth it.

3. Infrastructure & services

Internet: generally solid across European cities, especially major ones.
Healthcare: EU/EEA countries have decent systems; non-EU (e.g. Serbia) may require private insurance.
Flights: from Eastern Europe you can still reach Western hubs in 2–3 hours for €50–150 if you plan ahead.

4. Political & regulatory risk

Outside the EU, rules can change quickly (visas, taxation, banking).
Even inside the EU, countries occasionally modify tax regimes for freelancers or IT.

Early signs from the dataset (31 cities, 20 countries) show solid geo-arbitrage potential in multiple Eastern and Central European markets, but policy can and does shift. Keep an eye on it.

How to Negotiate Without Getting “Localised” to a Cheap Market

One of the sneaky killers of geo-arbitrage is when companies say:

“We pay based on local market rates.”

Translation: “We’d like to keep all the arbitrage gains for ourselves, thanks.”

Negotiation strategies that actually work

Delay the location discussion.
- Apply with a generic “Europe-based” description.
- Anchor salary expectations based on the employer’s market, not your cheap-apartment city.
Use market data from the employer’s city.
- For a Berlin-based company, cite Berlin salary ranges.
- For London, use London ranges.
- Don’t open with “I’m in Sofia so I only need €40k.”
Push for “location bands” rather than fully localised comp.
- Example: “EU high cost” vs “EU low cost” vs “Global”.
- Aim to stay in the same band as Berlin/Amsterdam/London, not be pushed into “Balkans tier”.
If they insist on localised comp:
- Consider shorter-tenure strategies: use them as a stepping stone while you interview elsewhere.
- Or accept it temporarily but aggressively upskill and reapply to better-paying companies after 12–18 months.

The best-case location arbitrage programmer setup is:

Employer in high-cost city → salary pegged there → you live wherever you want in Europe within a reasonable time zone.

When Geo-Arbitrage Is a Bad Idea

Let’s be honest: this isn’t for everyone.

You probably shouldn’t do this if:

You’re junior (0–2 years experience):
- Being physically near strong teams and mentors is often worth more than saving an extra €10–20k/year.
You’re on a career rocket ship in a top-tier org:
- If you’re on track for €250k+ comp in Zurich/London with great growth, don’t derail it for an extra €1,000/month saved in rent.
You highly value:
- Top-tier healthcare for family
- Specific schooling systems
- Being close to aging parents or kids from a previous relationship

Geo-arbitrage is best used as a tactical phase of life, not a religion.

A Simple Playbook for Geo-Arbitrage in Europe

If I had to summarise a good “remote salary low cost country Europe” game plan into something you can actually execute:

Phase 1 – Get the right job

Target remote-first or Europe-remote companies with:
- HQ / strong presence in UK, NL, DE, CH, Nordics, or US.
Land a role with:
- Solid tech stack (TypeScript, Go, Rust, modern backend, etc.)
- Compensation anchored to a high-paying city or region.
Negotiate your salary based on that city, not your future cheap base.

Explore jobs →

Phase 2 – Design your base

Shortlist 3–4 cities:
- Bucharest, Warsaw, Belgrade, maybe Sofia or Krakow (noting limited data for some).
Visit for 1–2 weeks each:
- Cowork from a space
- Test internet, commute, vibe, food, noise, air quality.
Run spreadsheet scenarios:
- Rent, tax, insurance, utilities → compare net savings per city.

See city rankings →

Phase 3 – Make it official (but not stupid)

Talk to:
- A local accountant in your target country (for contractor / company setup).
- Your employer’s HR/people ops if they’re using a payroll provider.
Decide:
- Employee via EOR vs contractor vs your own company.
Register properly:
- Tax residency, healthcare, bank accounts.

Phase 4 – Maintain growth while you bank cash

Maintain big-tech / strong-startup standards:
- System design, distributed systems, cloud, reliable coding practices.
Stay visible internally:
- Don’t drift into “cheap remote guy”.
Every 12–24 months:
- Re-run your market value.
- Switch jobs if your comp lags the employer’s market.

Do this right and you’re not just doing geo arbitrage as a software engineer in Europe – you’re compressing 10–15 years of “normal” savings into 5–7.

Final Thoughts

Geo-arbitrage in Europe isn’t magic. It’s just:

High-market remote income
Low- to mid-cost European city
Thoughtful tax + career planning

The data from 31 cities and 20 countries – with top spots like Brussels, Hamburg, Bucharest, Belgrade, London, Warsaw, Zurich – shows there’s real money on the table. In some setups, €30–40k extra per year in savings is absolutely realistic.

You still need to:

Avoid being localised into low pay
Stay employable at the highest tiers
Not destroy your social life in the process

But if you pull it off, geo-arbitrage is one of the most powerful “earn more, spend less as a developer” moves you can make in Europe right now.

Want to see where your city ranks, or find roles that make this possible?

Then it’s just a question of: how much longer do you really want to keep paying London or Zurich rent? 🏠💸