UK resident move abroad - website

Harvey Jones

When UK residents move abroad should they pack their investment portfolio too?

Moving to a new country is thrilling and exciting, but it also involves a lot of effort and responsibility, especially when it comes to managing your money.
As well as dealing with a new country and culture, you also need to find somewhere to live, choose schools if you have kids, find a broadband supplier, and comply with the tax rules in your new jurisdiction.
You have a lot on your plate, but here’s something you shouldn't overlook. You must make sure your investments are in the right place, too. So should you take them with you, or leave them at home?
And if you do shift them overseas, how do you do that without triggering a tax bill on your gains so far, or getting caught out by tax obligations in your new jurisdiction?
The answer will depend on factors such as where you are going, how long you plan to be away, and where you expect to go next.
It also depends on where you move your money.

Time to move on.
While the Covid-19 pandemic grounded the internationally mobile, people are ready to get moving again as lockdowns and travel restrictions ease.
Brexit has set some limitations on freedom of movement, but plenty of Britons will be looking to move to the EU and beyond, either for work or to seek a retirement in the sun.
You can enjoy your overseas adventure while leaving your investments safely at home, but the longer you are away, the less tax efficient this is likely to be.
Most UK-based investment platforms will continue to manage your existing holdings while you are resident overseas (with some exceptions, due to Brexit).
But once you are resident overseas, few will allow you to invest new money. That means you either need an investment platform in your new country of residence, or an offshore platform or international brokerage in a tax neutral jurisdiction.
For the internationally mobile, going offshore is typically the best option.
As well as being more tax efficient, this also spares you the upheaval of regularly moving your money, whenever you move yourself.

Beware capital gains tax shock.
Before you shift your existing investment portfolio, check if you will trigger a capital gains tax charge on your profits so far.
Britons are lucky, because they benefit from an attractive tax-efficient investment scheme, known as the Individual Savings Account, or ISA. UK residents can invest up to £20,000 each year, and take all their growth and income free of tax for life.
When they die, they may even pass on some of the tax advantages to their partner.
If you have money in an ISA and take your investment profits while still UK resident, you will not be liable to pay capital gains tax.
However, if you sell them after you are resident overseas, that is a different matter.

Beware this tax trap.
Many Britons who move overseas are dismayed to discover that while their ISA tax exemptions continue to apply in the UK, their new country of residence will not recognise them.
This means they may be liable to pay income tax and capital gains tax on their ISA holdings in their new territory (and possibly wealth taxes too).
An expat who decided to sell their ISA investments after leaving the UK could trigger an unexpected capital gains tax bill in their new home. It depends on the country and your personal circumstances.
This is the type of question you should ideally tackle before moving overseas.
This may not be a problem with moving abroad for a year or two. However, for those planning to live overseas for the longer term, this strengthens the arguments in favour of shifting money onto an offshore platform.
That way you can manage your tax affairs efficiently, and continue to do so regardless of where you move next.

Choose your platform wisely.
There are other reasons to invest via an offshore brokerage platform.
The best offer multi-currency accounts, such as pounds, euros, US dollars. This is a fantastic benefit for people who expect to move country regularly, or have assets and liabilities in different countries, as it saves on international currency transfer fees when moving money around.
Again, you could mix and match. For example, Britons could leave some legacy investments inside their ISA, but move the rest of their funds (and all new investments) offshore.

Play by the rules.

Using an offshore investment platform does not mean hiding your wealth away on some sun-soaked island where (you hope) the tax authorities can’t find it.
Expats should look for a reputable, established location with stable government, strong regulatory controls, statutory consumer protection, strict reporting requirements and other investor protection measures.
Typically, the best are found in Europe, notably Luxembourg, Dublin, the Channel Islands or Switzerland.
They offer protection of your wealth, backed up strict EU regulatory oversight for extra peace of mind.
Expats should also hunt down a platform with competitive fees that offers the widest possible range of international investments, particularly mutual funds and low-cost exchange traded funds (ETFs).
Ideally, they should offer everything from low-cost managed solutions to foreign exchange trading with no commission and the competitive spreads.
The right offshore platform should also specialise in helping expats, which means they can provide the products, advice and expertise you need.
Everybody's move abroad is different. So is their tax position. Consider taking independent specialist advice to help make the right decision for your circumstances.


Harvey Jones has been a UK financial journalist for more than 30 years, writing regularly for a host of UK titles including The Times, Sunday Times, The Independent and Financial Times. He is currently the personal finance editor of the Daily Express and Sunday Express, and writes regularly for The Observer and Guardian Unlimited, Motley Fool and Reader’s Digest.


Swissquote Bank Europe S.A. accepts no responsibility for the content of this report and makes no warranty as to its accuracy of completeness. This report is not intended to be financial advice, or a recommendation for any investment or investment strategy. The information is prepared for general information only, and as such, the specific needs, investment objectives or financial situation of any particular user have not been taken into consideration. Opinions expressed are those of the author, not Swissquote Bank Europe and Swissquote Bank Europe accepts no liability for any loss caused by the use of this information. This report contains information produced by a third party that has been remunerated by Swissquote Bank Europe.

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