Relocation package
is the support bundle for a moving employee: transport of household goods, temporary housing, travel, settling-in services, immigration costs and sometimes lump sums. Tax treatment varies — several countries exempt genuine relocation costs, while cash lump sums are usually taxable pay.
Designing packages that work
- Core moves: shipping, flights, first weeks’ housing and immigration fees — near-universal and often tax-favoured with receipts.
- Settling-in: school search, registration help, language training — cheap components with outsized retention effect.
- Lump sum vs managed: lump sums are simple but taxable and shift burden to the employee; managed services cost more and land better.
- Clawbacks: repayment scales for early leavers, drafted within local enforceability limits.
- Tax check per country: exemptions differ — document costs, use gross-ups deliberately where promises are net.
FAQ
What does an international relocation cost?
Regional moves with modest households commonly run EUR 5,000–15,000; intercontinental family moves with school support EUR 20,000–50,000+. Immigration fees, temporary housing length and shipping volume drive the spread — budget from a per-move quote, not an average.
Are relocation payments taxable?
Reimbursed, documented moving costs are tax-exempt or favoured in many states (Germany’s Umzugskosten rules, UK’s capped exemption); cash allowances without receipts are generally taxable salary. Structure the package around the destination’s rules before promising net amounts.