Contact

News & Insights

Expat Campaigners Close in on Frozen Pension Change

There is undoubtedly a strong argument for change – those affected paid the full level tax and national insurance contributions throughout their working lives in the UK yet, due to archaic laws, receive only a fraction of the pension received by expats based in other locations.

For many years the UK has had reciprocal pension arrangements with certain countries, where pensioners are paid the full going rate. This includes countries in the European Economic Area. Yet curiously, those in former commonwealth countries such as Australia, Canada, New Zealand and South Africa are on the end of a glaring and unacceptable expat pension inequity, receiving only the level of pension that was in place when they left the UK rather than the level their peers are entitled to today.

The worst part of all this is that this longstanding inequity could easily be remedied. In fact, the government has had the chance to do so every year for the past seven decades as part of its annual update of the terms of state pension. However, with the next review not due until spring 2019 there are fears that the government might again pass up the opportunity to make changes through the Social Security Benefits Up-rating Regulations.

As such, a campaign group, End Frozen Pensions, has been formed to bring about the necessary expat pensions changes.

“By building a parliamentary alliance we will stop this Government trick and end the frozen pension policy,” said a spokesperson with the group. It is estimated that the necessary changes would cost around £500 million a year. However, given that by being outside of the UK, expats place no additional strain on the UK’s health and welfare resources it is hard to make a persuasive economic justification for continuing the expat pensions inequity.

Sir Roger Gale, Conservative MP for North Thanet in Kent and chairman of the parliamentary group on Frozen British Pensions, commented, “There is a group of people who have served this country and paid their dues throughout their working lives who now find that their pensions are frozen. It leads to the anomaly where a pensioner living on one side of Niagara Falls has a frozen pension, while a pensioner living a few hundred yards away on the other side in the US has an uprated pension, annually. It is nonsense and iniquitous.”

Pensions Advice from Blacktower FM

Blacktower is a cross-border wealth management specialist with particular expertise in the area of expat pensions.

Not only can we help you with pension planning and expat retirement transfers, we can also make an assessment of all your assets and income streams, including the state pension, so that you have a clear idea of how best to structure your wealth in order to achieve your financial goals.

Contact us today for more information.

Other News

The cost of care as an expat

Baby's foot with hospital ID tagBecause many UK expats will still have friends and family living back in the UK, it’s common for them to make frequent trips back and forth between their previous home country and their chosen destination, especially during holidays such as Easter and Christmas.

This arrangement works nicely for many expats, allowing them to enjoy the best of both worlds as they set up a new life in an new location while still being able to retain a taste of home. But it’s not without complication, and it is wise for all expats moving between countries to understand their rights regarding healthcare in every place they visit. Otherwise, they may be left to face the financial consequences if their health take an unexpected turn.

Read More

Dutch Tax Exemption Rule Change Hits Expats

Pen and checkboxOpposition to the imminent changes to the Dutch 30% tax reimbursement scheme (see the Blacktower news feed) is growing. Now, VCP, the Dutch white collar workers’ union, has joined the dissenters by calling for, at the very least, a transition period for expat workers who will suffer unwanted changes to their Netherlands wealth management plans as a result of the amendments.

It is easy to see why so many people find the timetable for the ruling so unjust; those affected could see their incomes reduced by around 20% once the ruling comes into force in under six months.

It could also result in unwanted damage to the Dutch economy, with real fears that it could deter expat workers from coming to the Netherlands in the first place.

Read More

Select your country

Please select your country of residence so we can provide you with the most relevant information:

You are currently viewing the Blacktower Financial Management EU website.

You may be looking for the Blacktower United States website.

Blacktower United States > X Stay on this site

Or choose your country.