Living in France but Still Holding UK Assets? Why It May Be Time to Review Your Position

Many British expatriates move to France seeking a better lifestyle, lower stress and a higher quality of life. Yet while they relocate themselves, their wealth often remains firmly rooted in the UK.

Property, pensions, investment portfolios and savings accounts are frequently retained long after a move abroad. While this may feel comfortable and familiar, it can expose expatriates to a growing number of UK tax reforms and financial planning challenges.

With the UK tax landscape undergoing significant change, now may be the right time for British expatriates in France to review whether continuing to hold substantial UK assets remains in their best interests.

The UK’s Changing Tax Environment

Recent years have seen a series of tax increases, frozen allowances and reductions in available reliefs.

Many of these measures are expected to remain in place for years to come, while further reforms continue to be discussed.

For expatriates who have left the UK permanently, this raises an important question:

If you’ve left the UK, have you considered how your assets may still be exposed to UK taxation?

Every asset retained in Britain remains potentially affected by future legislative changes, whether that asset is a pension, property, investment portfolio or cash holding.

For many expatriates, reviewing these arrangements now may provide  an opportunity to assess whether their financial arrangements remain aligned with life in France and their long-term objectives.

Inheritance Tax: The Growing Threat

Inheritance tax has become one of the fastest-growing sources of revenue for the UK Government.

The nil-rate band has remained frozen at £325,000 since 2009 and is expected to remain frozen until at least 2031. Meanwhile, property values, investment portfolios and pension wealth have continued to increase.

For British expatriates living in France, UK-based assets remain exposed to UK inheritance tax.

This includes:

• UK property
• UK investment portfolios
• UK bank accounts
• UK pension arrangements

The position becomes even more significant from April 2027 when most unused pension funds are expected to become subject to UK inheritance tax.

For families hoping to pass wealth to future generations, this could increase potential tax liabilities depending on individual circumstances.

France Offers a Different Approach

For French residents, succession planning operates under a different framework.

Children currently benefit from a €100,000 allowance each before succession tax becomes payable, with tax rates starting relatively low and increasing progressively as inheritances rise.

While French succession planning has its own complexities, reducing unnecessary exposure to UK inheritance tax may form an important part of a wider cross-border estate planning strategy.

Pensions: A Key Planning Consideration

For many expatriates, pensions represent their largest financial asset.

Historically, UK pensions have often formed an important part of long-term retirement and estate planning arrangements. However, planned inheritance tax changes are prompting many retirees to reassess their pension arrangements.

From April 2027, most unused pension funds are expected to fall within the scope of UK inheritance tax. Combined with income tax liabilities that may apply when beneficiaries draw inherited pensions, the overall tax burden can become significant.

As a result, many expatriates are exploring alternatives.

Potential options may include:

• Reviewing pension withdrawal strategies
• Reviewing existing pension arrangements where appropriate.Evaluating French tax treatment of pension income
• Exploring reinvestment opportunities within France

One arrangement that may be considered as part of broader cross-border retirement planning is a Qualifying Recognised Overseas Pension Scheme (QROPS), although such arrangements are not suitable for everyone and transfers may trigger the UK’s Overseas Transfer Charge in certain circumstances.French tax treatment of pension lump sums may differ depending on individual circumstances and applicable rulesProfessional advice is essential, as pension planning remains one of the most complex areas of cross-border financial planning.

Is UK Property Still Worth Keeping?

Many expatriates retain UK property after moving to France.

The reasons vary:

• A future return to the UK
• A holiday base
• Family use
• Rental income
• Long-term investment

However, the economics of UK property ownership have changed significantly over the past decade.

Successive tax reforms have increased costs for landlords and property investors, including:

• Capital gains tax changes
• Restrictions on mortgage interest relief
• Abolition of furnished holiday letting tax advantages
• Higher stamp duty costs
• Expanding inheritance tax exposure

Additional measures are expected in the coming years, increasing the financial burden further.

At the same time, French residents must also consider French tax implications, including wealth tax exposure on real estate holdings.

For some expatriates, diversifying away from UK property may offer greater flexibility and reduced administrative complexity, depending on individual circumstances.

Managing Capital Investments More Efficiently

Many expatriates continue to hold UK ISAs, investment accounts, shares and funds long after becoming French tax residents.

While these investments may have performed well historically, they are not always structured efficiently from a French tax perspective.

A review of investment holdings can provide an opportunity to:

• Assess tax treatment
• Review inheritance planning considerations
• Simplify administration
• Align investments with French reporting requirements
• Review currency exposure

Since daily living expenses are typically denominated in euros, reviewing currency risk becomes particularly important. Holding assets in the appropriate currency can help reduce the impact of exchange-rate fluctuations on retirement income and purchasing power.

The Benefits of Assurance-Vie

One investment structure commonly used by French residents is the assurance-vie.Often described as the cornerstone of French financial planning, an assurance-vie may provide:

• Investment and tax planning features
• Estate planning considerations
• Succession planning features
• Investment flexibility
• Multi-currency capabilities

For expatriates seeking to align their investments with their French residency, assurance-vie arrangements frequently form an important component of a wider wealth planning strategy.

What If You Split Time Between the UK and France?

Some individuals continue to maintain homes in both countries and divide their time between them.

In these situations, tax residency becomes critically important.

Where an individual remains UK tax resident, they continue to be exposed to UK taxation on a broader range of assets and income.

By contrast, becoming tax resident in France may provide opportunities to benefit from aspects of the French tax regime, depending on individual circumstances and objectives.

As residency rules can be highly complex, personalised advice is essential before making decisions based on tax residency alone.

A Strategic Review Could Deliver Significant Benefits

Managing wealth across two jurisdictions is rarely straightforward.

Tax legislation changes frequently, pension rules evolve and inheritance planning considerations continue to become more important.

For British expatriates living in France, reviewing UK pensions, property and investments is not simply about reducing tax. It is about ensuring your financial arrangements remain aligned with your lifestyle, residency status, family objectives and long-term plans.

At Blacktower Financial Management, we support expatriates in navigating complex cross-border financial planning considerations. By reviewing your assets holistically, we can help you understand your current position and consider potential strategies in line with your individual circumstances and objectives.

This article is for general information purposes only and does not constitute financial, tax or legal advice. Tax treatment depends on individual circumstances and may change in the future. Investments can fall as well as rise in value, and you may get back less than originally invested.