8 money questions to ask before moving to another country
There’s been a surge of Brits relocating to EU countries since the Brexit vote.
Last year almost 13,000 people jumped ship to another member state, more than double the 5,000 who did so in 2016, according to figures obtained by the BBC.
The rise is presumed to be fuelled by fed-up Remainers who can meet the criteria for residency in other countries and want to keep their legal rights under EU membership.
Many may want to be relocated before March 29 next year in case it becomes more difficult to make the move after the UK leaves.
Germany has seen the biggest increase in Brits obtaining citizenship there with the numbers up from 2,702 in 2016 to 7,493 last year.
France is the second most popular country – leaping from 439 gaining citizenship in 2016 to 1,518 in 2017.
Figures from the Office for National Statistics show they are joining a rising flow of Brits fleeing to EU states. Around 144,000 made the move to Spain between 2005 and 2015, with 129,000 heading to France.
Financial firm Blevins Franks, which provides guidance to British expatriates in Europe, says enquiries about relocating have increased almost tenfold, with nearly 25,000 people seeking help in the past year.
Director Jason Porter says: “The issue is that thousands of Britons still want to retire to sunny Europe but are unsure how to do so, given Brexit.
“They have particular questions about their residency and tax status and access to their pensions and local healthcare facilities.
“The UK and EU have already agreed divorce terms around legal residency, healthcare and the British state pension triple lock for nationals who move before the end of the transitional period. But actually signing these off is being held up by issues like the Irish border. And, as the EU mantra goes, ‘nothing is agreed until everything is agreed’.”
Latest Brexit news
Will I still get free healthcare after Brexit?
In a policy paper, the Government is seeking to maintain reciprocal healthcare rights for Brits living in European Economic Area (EEA) countries after Brexit. If this is accepted, you will receive medical care at the same level as locals – although some countries don’t have a free service like our NHS.
You will need to research the situation in your chosen country. In Portugal, for example, once you have residency you get the same healthcare as locals. France is stricter and you have to be receiving the UK state pension or contributing to the French social security system.
In Spain, if you don’t qualify under any other means you can make a monthly payment of 80 euros, 140 Euros if over 65.
What about my state pension?
The policy paper also wants to guarantee the current triple lock on the state pension, which guarantees it will go up at the rate of inflation, earnings or 2.5% annually – whichever is higher.
8 money questions to ask before going anywhere
Where are you tax resident? This is important as your country of residence will normally tax you on your worldwide income and gains.
Are you paying tax in the right country? Many British citizens living abroad do not.
Are there any special regimes for new arrivals in the country? For example, Portugal has its Non-Habitual Residents regime, enabling those who become a Portuguese tax resident to receive qualifying income tax-free, both in Portugal and the country of source of the income – including pension, dividends, royalty and interest.
Is there a double tax treaty? In some places you have to pay tax in both countries, but the existence of a double tax treaty stops this.
What about your pension income? Some jurisdictions allow you to take it tax-free for a period. Others allow it to be taxed at a fixed rate, which can be significantly lower than UK rates.
Are your investments tax efficient for you? Investments set up in one country may be less advantageous if you move to another. For instance, UK ISAs have no tax efficiency overseas.
Do you have rental properties – and rental income – in the UK or the European jurisdiction that need to be taken into account?
How will succession law in your new country of residence affect the inheritance tax your beneficiaries will have to pay? Some assets may be subject to tax both in the UK and your new country of residence when you die.
Source: Read Full Article