And although there is still the prospect of the UK negotiating an EU-wide deal, there remains the possibility that it could be negotiated on a country-by-country basis.
As it stands, 472,000 expats in the EU receive the automatic annual state pension increase, which is certainly a better deal than that received by more half a million pension-eligible UK expats living elsewhere in the world. Australia, Africa, Canada and India are just some of the countries where expats don’t receive state pension increases; there are other places outside of the EU – for example US, Jamaica, Israel, Switzerland and the Philippines – that do allow expats to receive their full, adjusted entitlement.
Fortunately, for retirees who want to transfer their private pension to a QROPs or QNUPs scheme, it is still possible to do this – despite speculation that Brexit might end this arrangement.
QROPs really do represent a prudent wealth management option for many pensions savers. Under the arrangement up to £1 million can be transferred into a QROPS without the incurrence of any UK tax penalty. And once the initial transfer has been made, it is perfectly possible to top up the fund without picking up further penalty.
There are so many situations where QROPS is the best expat pension option. For example, where an employer has offered a cash buy-out QROPS can be a way of moving money to a place where it is protected from legislative changes or financial uncertainties – even final salary schemes can be transferred into a QROPS.
One thing that might benefit British expats is a new group which has recently been established to fight for the rights of British expats during Brexit negotiations. Expat Citizen Rights in EU, already has 1,500 members resident in 19 countries, with 69 percent already retired.
81 percent of members have stated that pensions are a major concern for them in the post-Brexit environment, second only to healthcare, which was a concern for 84 percent. Let’s hope that they have sufficient influence to ensure that their key concerns are looked after once Article 50 is invoked.
In September 2017, it was announced that the Portuguese Government, following pressure from Sweden and a number of other European countries, was looking to water down the country’s non-habitual residency (NHR) tax regime, potentially bringing to an end a programme that has worked in the interests of expats since 2009. The uncertainty this proposed move provoked certainly threatened to put a dampener on the financial plans of quite a number of expats and would-be expats as they moved into 2018.