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Ask HN: How much does it cost to live in London?

9 points by oscardelben ↗ HN
I am considering moving out of Italy because here I'm paying a lot of taxes and I can't even afford a rent alone. One choice I'm considering is moving in London with a friend.

I am a freelancer programmer and I have a budget of 2600 dollars/month before taxes. This is for working 3 days per week but I could always find a part time job. I don't have special requirements, but what I'm really interested in is how much would it cost to open a company there, and how much taxes I would have to pay there. Also health insurance and common expenses are something I need to consider.

Thanks

16 comments

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davidw
My guess is that London is not at all cheaper than the Veneto, just that you can earn more money there, and, likely, more money in proportion to your expenses.
oscardelben
Yes but here in Veneto If I earn $3000 dollars (after the 20% of vat) I have to pay nearly $1400 in taxes, and then I have to pay for all the other hidden taxes like inps, inail and the accountant of course.
blahpro
There are plenty of wonderful places in the UK outside of London that are considerably cheaper. If you’re a freelancer, there might not be any need for you to live in The City.
harrybr
I'd second that. London is a city best enjoyed when wealthy. There are lots of other lively cities and towns in the UK to consider. Brighton, for example, is only a 60 minute train ride out of London, and it has a thriving geek scene. Most events are free and everything is in walking distance.
yetanotherlogin
For a fairly but not horribly austere lifestyle, you're looking at ~£20k GBP to get by.

By this I mean you have a place to live somewhere in a fairly unfashionable/average zone 2 or 3 area, a place which is not that big or plush, but not a rat-infested crack den either. You share it with at least one, perhaps a few other people. You can afford all the basics of food, heating etc, plus a small amount of "luxuries" (go out for a few drinks here and there, keep yourself in clothes that arent falling apart, a few books/cds/dvds, that sort of thing) but you'll be taking the bus rather than a taxi, you'll be drinking £5 wines rather than £50 wines, you'll entertain yourself with a free museum visit rather than a pricy theatre ticket, etc. You won't starve but you will find yourself turning down social invitations due to lack of cash.

If you want to live in zone 1 and/or an upmarket part of town and/or on your own, eat out / go drinking / go to the cinema / whatever regularly (eg more than once weekly), go on foreign holidays, buy shiny new tech gadgets, dress in designer label clothing, etc, then obviously more, and more, and more income is required... With no limit!

It seems that 2600USD pcm (I assume you mean USD) is not so far away from what I earn. I find myself living a lifestyle I would consider comfortable; however I naturally lean more towards the former paragraph than the latter. My current lifestyle is certainly more free-spending than the first paragraph (for example, I can afford taxis and going out often without ever seeming skint) - but it is still nowhere near the second paragraph - however I have little to no interest in world travel, designer fashion, plasma tvs and the like and therefore I do not miss them. So it depends on your lifestyle desires.

I do not know anything about costs of companies. As for health insurance -- I cannot vouch for this point 100% but I'm fairly sure this should be a non-issue: as an EU citizen I believe once you have paid the normal income tax and National Insurance the same as I do, you would be entitled to NHS healthcare.

I hope this helps. Feel free to follow up with any further questions about London life you may have.

oscardelben
I don't need plasma of things like that, I'm just happy with my computer. Thanks for the info, I hope to find out more information about taxes.
revorad
Registering a company only costs £25. I'm not entirely sure about the taxes yet as I'm just in the process of setting up mine.

If you are sharing a flat with one or two people, you can get a good place starting from around £600 (inc of all bills) in zone 2, which is say 10-20 minutes bus/train ride to the city centre. As you go outwards, you get more for your money.

Eating and going out once in a while may cost you another £300-£500 depending on what options you go for. But in this respect, London provides a lot of options to go bankrupt in no time.

I'm currently living in a pretty good area in south London, sharing with one friend, not going out much and living on well within £1000 a month. I'm looking to move to a cheaper place in May and hope to save another couple hundred pounds.

Drop me an email (see profile) if you need any more help or want to meet up when you are in town.

Good luck!

oscardelben
£1000 pounds seems very doable for me and my current situation. I'll send you an email just in case you'll have more information about taxes.
revorad
I must say your social life will be fairly limited with £1000 unless you try and go for a cheaper place to stay. I think it's still worth a shot because London is a brilliant place to be. I may not have much money to spend but even walking around town is a treat.

Plus, the English countryside is very beautiful (if you're into that kind of thing). You can easily get away for a hike or walk to many places within an hour's train ride. If you go further, there's a lot more to explore.

If it matters to you, I have a few Italian friends here. And generally, there are a ton of Italians in London. It may help if you feel homesick sometimes.

I should really find all out about the taxes, so yeah do email me. I'll keep you posted.

ig1
That would be around £1700/month, if you setup a company for the money to go through your takehome pay will probably be around 70-80% of your company's income (so around 1200-1360). That'll be fine if you get a flatshare, if you want to get a one bed flat to yourself it'll be tight.

Also see if you can find a business reason to be in london (i.e. that's where clients are, etc.), because if you have a legit business reason for it then you can claim the cost of your rent as a business expense and pay for it out of pre-tax income for upto two years.

pmjoyce
"if you have a legit business reason for it then you can claim the cost of your rent as a business expense"

I'd be a little careful about this. The advice I received was that the Revenue clamp down on things like this pretty hard. I used to push a proportion of my rent through my company books (I was working from a home office almost 100% of the time) but after seeking the advice of a specialised tax accountant I promptly stopped.

I'd recommend speaking to some good tax accountants before making any decisions like this and to discuss some strategies for maximising your take home. Drop me a mail if you would like me to put you in touch with the company I work with (I've been with them for the past 4 years) - they specialise in advice and services to small firms and contractors particularly those who work in IT.

ig1
I think you're talking about using your home as a home office, that's different. I'm talking about when you're working in a location away from your main residence for the purpose of business you can typically claim rental (if it's less than a hotel would cost) for up-to two years even if you do no work at all in the residence.
hcho
Choose a cheaper place on the commuter belt and your income will go a longer way. For instance Woking is 30 mins to London by train, but is a lot cheaper than London. You can get a flat for around about £700 pcm bills and council tax included and without sharing with someone else. This will leave you with a grand to play with, which is not bad.
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