08 January 2018
The Brexit leave vote came at a bad time for many would-be expats planning an escape from the UK, but is it safe to go ahead as things stand at the moment?
Whether to go or stay is a crucial question without an easy answer, as there’s no indication of certainty in anything which has been agreed to date between the two sides. Expat freedom of movement, pensions, health considerations and more have been discussed and agreed in principle, but are far from being set in tablets of stone.
Taking a chance and emigrating to the European member state of your choice will largely depend on your personal circumstances as regards income and tax liabilities. Whilst there are a number of jurisdictions in Europe where certain tax structures can give a better standard of living with less tax liability, these depend on your motivation for emigrating and your stage in life. In addition, whether you’re retiring or continuing to work will also have an effect on your options.
As already mentioned, no-one, not even the negotiators themselves, has the faintest idea of the final form of Britain’s divorce settlement. All EU member countries will need to agree on terms, thus suggesting that what works in, say, Spain, will be the same in France, Belgium, Portugal et al, including healthcare, residency, state pensions and social security deductions. The prospect of one or more members states not being in agreement doesn’t bear thinking about.
Comparing the benefits of EU countries’ tax structures is a chore for experts and possibly impossible for expats due to differing tax rates, taxes on pensions, wealth taxes and tax relief. Moving overseas simply on the basis of tax relief isn’t the best idea ever, as most tax-friendly countries have other tricks to force you to pay extra dues. From a European perspective, unless you’re super-rich the most attractive destinations are Cyprus, Malta and Portugal.
As regards the final Brexit elephant in the room, the much-discussed transition period is likely to take much longer than the designated time, giving you several years at least to establish your residence in your favoured country. Being there may be a better position than standing on the doorstep waiting to be allowed in, especially as regards healthcare benefits and successful residency applications. All you need to remember is that every single EU member state has its own tax laws.