How Brexit Will Forever Alter UK Expat Pensions

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How Brexit Will Forever Alter UK Expat Pensions
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• As 2020 continues to spin from one crisis to the
  next, Brexit seems to have faded into the
  background. After all, the UK has already left
  the European Union, and nothing seems to have
  changed dramatically in the interim.
• This false sense of security may cause a big
  wake-up call come January 2021.
• We are currently in the Transition Period,
  which runs up to 31st December 2020. During this
  phase, there are no changes to policies or
  procedures, which means it might feel like Brexit
  has fizzled out and disappeared from the front
  pages without the anticipated fireworks.
• However, after the end of this year, changes are
  most assuredly coming. Chase Buchanan aims to
  provide guidance and support to ensure you know
  what those changes are likely to look like and
  what you can do now to secure your financial
  future.

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UK Expat Pensions in Europe Whats Changing?
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Millions of British nationals choose to retire
abroad, and for a range of reasons. Better
weather, better housing prices, a better quality
of life and better tax regimes are all appealing
options if youre approaching retirement and are
seeking the ideal way to enjoy your well-deserved
golden years.   With Spain, Portugal, France
and Cyprus among the most popular expat
retirement destinations, Brexit looks set to put
a permanent dent in those plans, unless swift
action is taken.   What is likely to change?
Here are some of the most vital
considerations   Pension Transfers Currently,
you have several options for transferring a UK
pension abroad. These choices depend on the
country, and your type of scheme, but there are
appealing options to reduce tax liabilities and
avoid currency fluctuation risks. There is the
potential for the UK to introduce huge 25
Overseas Transfer Charges to all overseas fund
movements thus taxing a quarter of your pension
fund before you have drawn a single payment.
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State Pension Eligibility As an EU/EEA member
country, expats in Europe continue to receive
their UK State Pension, including the annual cost
of living allowance. Countries outside of the EU
do not all offer such an option. It is therefore
vital to understand how State Pension eligibility
might change from 2021 onwards. Uncertainty for
New Expats For those already resident abroad,
many impacts will be minor, such as potentially
needing to renew a residency card. However, for
prospective new expats and those approaching
retirement, there is much uncertainty about
freedom of movement, pension transfer options and
taxes payable when retiring to Europe. For more
detail about changes to UK pension schemes for
expats in Europe after Brexit, you can download
our FREE Guide UK Pension Schemes The Impact
of Brexit.
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Preparing for EU Retirement Post-Transition Period
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• So, what actions are available to you? As it
  happens, rather a few.
•  
• Creating a future-proof strategy now is vital to
  ensure you dont fall foul of changing tax
  treaties and pension entitlement legislation.
  Most changes will take effect from 1st January
  2021, so if you have the option of securing
  residency beforehand, you might slip into current
  entitlements, and avoid needing to make any
  significant changes to your retirement plans.
• Where new announcements are anticipated, they
  will also likely have an implementation period.
  Therefore, consulting a financial advisor or
  wealth management expert now could save a great
  deal of headaches in the future, while there is
  still time to consider the options that could
  improve your status in the future.
• The urgency arises partly due to the scant time
  left before the Transition Period ends, and
  partly because of the timescales involved with
  making changes to your pension schemes and
  retirement assets. For example, pension transfers
  (such as transferring a UK private scheme to a
  Recognized Overseas Pension Scheme, or ROPS),
  take several months from start to finish.
• By considering the implications of such a
  transfer as far in advance as possible, you have
  the flexibility to decide to proceed with a
  transfer provided your advisor recommends this
  as the most advantageous option with the
  assurance that the paperwork and transactions
  will complete in advance of regulatory changes.

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What Other Retirement Implications Should EU
Expats Consider?
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• Pensions are always a headline consideration,
  given the importance of securing your investment
  funds to see you through a comfortable
  retirement.
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• However, it is easy to forget the scale of
  Brexit, and how this could considerably change
  your position with regards to multiple
  cross-border assets
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• Inheritance and succession taxes.
• State wealth taxes on capital and property.
• UK taxes on British property.
• Currency fluctuation issues.
• Overseas savings and investments.
• Double tax treaties and tax residency status.

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Brexit is an extensive alteration in the way the
UK trades with the EU and it is crucial to
consider each and every asset, account,
investment and fund to determine how Britains
departure might impact that. For example, assets
currently taxed on beneficial rates as an EU
member state, may suddenly become subject to
non-EU rates and restrictions.   Double tax
treaties may change, be removed, or require
separate applications and treatment to avoid
paying duplicate taxes in both your home and host
countries. Properties owned overseas might be
taxed at source, or be taxed according to local
tax regimes, depending on your tax residency
status, level of income, and the type of property
owned.   The fundamental point here is that,
while Brexit may bring about far-flung changes,
being prepared means avoiding any short, sharp
shocks, and having the assurance that your assets
are held in the most stable, safe and secure
vehicles possible.
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Expert Support for UK Retirement Planning
The Chase Buchanan team is committed to providing
the highest-quality professional financial
support for UK expats who are planning to retire
abroad or are currently resident in an EU
country.   Whether you are concerned about the
solidity of your retirement plans, would like
support with structuring investments and assets
in alignment with your aspirations, or need to
protect your pension fund in advance of Brexit,
our teams are on hand to help.   Our FREE
Guide UK Pension Schemes The Impact of Brexit
explains all of the potential changes and a
short-list of the most beneficial actions
available to smooth your way through the end of
the Transition Period. Download your free guide
today, or contact the Chase Buchanan team for
bespoke advice and tailored recommendations to
secure your retirement in Europe.
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