The two relocation realities
Expatriate families fall, broadly, into two camps. The first camp moves under a corporate relocation package, with the employer covering some combination of moving costs, housing allowance, school fees, healthcare and a partner support stipend. The second camp moves under their own steam: a self employed partner, a remote role at a domestic salary, an entrepreneurial pivot, a partner posting that does not bring a benefits package. Both camps experience the same destination city, but the household budget arithmetic is fundamentally different. For families with school age children, the gap is widest at the school fees line.
The first camp often discovers that the package is less generous than it sounded. Employer paid school fees are usually capped, often per child and per academic year, and the cap was set against a fee market that has moved on. The second camp often discovers that the self funded path is more navigable than they expected, because the international school market has more middle tier options than the conversation around the top tier suggests. Both camps benefit from running the numbers carefully before the move, not after.
Side by side comparison
The table below summarises the typical pattern across the cities we cover. Numbers are illustrative and vary widely by country, employer, school tier and year group.
| Item | With employer support | Without employer support |
|---|---|---|
| Tuition coverage | Typically 80 to 100 per cent up to a cap of GBP 25,000 to GBP 35,000 per child per year | Family pays full tuition |
| Capital levy | Rarely covered, usually paid by family | Family pays in full at enrolment |
| Transport, books, exams | Sometimes covered, often excluded from cap calculation | Family pays, typically 25 to 35 per cent of tuition |
| Housing allowance | Usually included, often tied to a band by family size | Family pays from gross salary |
| Tax treatment | School fees may be benefit in kind, varies by country | Paid from after tax income, no relief in most countries |
| Notice period flexibility | Employer may negotiate withdrawal on relocation | Family bears full notice period cost |
| Choice of school | Often restricted to a preferred provider list | Open choice within budget |
Model your real all in cost
Our cost calculator takes school fees, housing, taxes and lifestyle into a single annual all in figure. It is the cleanest way to compare a corporate package against a self funded route.
Run the calculatorWith employer support: what is typically covered
A full corporate relocation package, the kind seen at senior management level in oil and gas, finance, consulting, technology and diplomatic postings, usually covers tuition up to a cap, plus housing allowance, plus tax equalisation, plus moving costs, plus home leave flights once or twice a year. School fees are normally invoiced directly from the school to the employer, and the family sees only the items above the cap or outside the eligible list.
The covered list usually includes published tuition, sometimes books and lunch, and sometimes the school bus. The not covered list usually includes the capital levy, the application and registration fees, individual music or sport tuition outside the standard curriculum, and any voluntary parent association contributions. The boundary varies by employer. Read the relocation policy document before you sign, not after. The boundary is rarely renegotiated mid posting.
One subtle point. The employer cap is usually set in the employer's home currency, often US dollars or sterling, and is revisited every two or three years. In cities where school fees have risen faster than the cap (Singapore, Hong Kong, Switzerland, parts of the Gulf), the cap can drift from covering 100 per cent of a tier one school to covering 70 per cent. The shortfall lands on the family balance sheet. Track the cap each year and raise it with HR before each renewal.
Without employer support: what families pay for
A family relocating without an employer package faces the full cost of international schooling from after tax income, plus the same housing, healthcare and lifestyle costs that the package would normally have offset. In high cost cities, the math is unforgiving. In moderate cost cities, the math is feasible if the family chooses carefully. The cost of tier one schooling for two children in Singapore is roughly equal to the median Singapore household income. The same two children at a mid tier school in Bangkok cost roughly twenty per cent of the median expatriate household budget. The right school choice carries more weight when there is no package to absorb the variance.
The most useful move for self funded families is to revisit the assumption that the top tier is the right tier. Many tier two and tier three international schools deliver excellent outcomes at sixty to seventy per cent of tier one fees. Our piece on negotiating school fees into the relocation package covers the same logic from the corporate side and the conclusion is identical: the academic outcomes are far less correlated with fees than the school marketing implies.
The five year cost differential
Across five years for two children at a tier one school in a high cost city, the gap between a package family and a self funded family is in the order of GBP 250,000 to GBP 400,000 of after tax cost. The number is large because school fees are recurring, capital levies are one off but sizeable, and the loaded fees (transport, books, exams, trips) layer thirty per cent on top of tuition. Even a partial employer subsidy of fifty per cent narrows the gap by a quarter of a million pounds over five years.
For the family weighing a job change that would move the package from full to partial, the school fees line is usually the largest single shift in household finances. The pay rise that compensates for losing full school fees support is often larger than the role's salary band can accommodate. Run the numbers honestly. The hub at relocate covers the wider expatriate finance picture and the cost calculator is the right entry point for running a personalised comparison.
Negotiating school fees into the package
School fees are negotiable into a package more often than parents assume. The opening is at offer stage, before the contract is signed. The argument that lands best with HR is that the role's location is what creates the cost (the children would attend a different, cheaper school in the home country) and that the cost is a known number, not an open ended commitment. Most multinationals have a school fees line in their internal mobility framework and most will fund it for senior roles in cities where domestic state education is not a realistic option for an expatriate child.
The negotiation framing matters. Asking for tuition cover for the next three years lands better than asking for an indefinite commitment. Asking for a cap that matches the city's tier one school median lands better than asking for one school by name. Offering a return commitment (the executive remains in role for the duration of the school fees support) sometimes unlocks a higher cap. None of these are guaranteed. All of them are easier to negotiate before the signature than after.
Tax treatment differences
Employer paid school fees are treated differently across jurisdictions. In the UK and the US, school fees paid by an employer are usually a taxable benefit in kind on the employee. The employer often grosses up the benefit, which means the employee receives the school fees free of tax but the employer pays both the school and the tax on the school fees. In the Gulf countries and in Singapore, school fees are usually a non taxable benefit because personal income tax is low or zero. In several Continental European countries, the tax treatment is partial and depends on the structure of the relocation package.
For self funded families, school fees are paid from after tax income in nearly all jurisdictions. A small number of countries offer a partial deduction or a tax credit for private school fees in defined cases, but the relief is rarely enough to materially change the calculation. The cleanest planning is to model the cost net of any relief and then to apply the relief as upside if it materialises.
Which to pick if...
If you are weighing two roles, one with a package and one without: the package is worth, in school fees alone, between GBP 30,000 and GBP 60,000 per child per year in a tier one city, before tax. Use that figure as the salary gap that would compensate. Anything smaller and the package wins on family finances. Anything larger and the self funded role can compete.
If you are inside a package that caps school fees below market: raise the cap each year at policy renewal. Use comparable cap data from peer cities (which HR usually has) as the argument. The gap is rarely closed in one year but is regularly closed over two or three.
If you are self funded in a high cost city: consider tier two schools seriously. The outcome difference is usually smaller than the fee difference. A strong tier two school in Singapore or Hong Kong often outperforms a stretched tier one budget in the same city.
If you have multiple children at different year groups: sibling discounts vary widely. Some schools offer a 5 to 10 per cent reduction on the second child, very few extend it to third and fourth children. Factor the discount into the comparison but do not let it drive the choice. Choose the school first, then ask about the discount.
Frequently asked questions
Are employer school fees taxable? Usually yes in the UK, US and several European countries, often as a benefit in kind. Usually no in the Gulf and most of Asia. Confirm with the employer and a tax adviser.
Can we choose any school under a package? Usually within a preferred provider list, or up to a cap. Some employers have a school by name list, especially for senior roles in specific cities.
Does the package cover the capital levy? Rarely. Capital levies are normally treated as a one off family cost outside the cap.
What happens to school fees if the relocation ends early? Most schools require one term's notice. The notice period is the family's responsibility unless the employer absorbs the residual cost as part of the relocation termination terms.
Can we negotiate fees into a package after signing? Possible but harder. The renewal point and the promotion conversation are the realistic openings.