British Expats May Need To Reinvest To Gain EU Residence Visas

expat network

British Expats May Need To Reinvest To Gain EU Residence Visas

British expats may need to reinvest their assets in order to meet EU residency visa requirements and establish permanent homes in EU countries. Applicants must show that they and their dependents have incomes sufficient to prevent them becoming a burden on the state.

What constitutes both ‘income’ and ‘sufficient income’ varies from one country to another. Unfortunately, many popular expat investment structures do not generate ‘sufficient income’.

“This raises a problem for many expats who have invested in EU-compliant, tax-efficient investment products,” said Jason Porter, director of specialist expat financial advice firm Blevins Franks and head of its new European Emigration Advisory Service.

“Many have placed their financial assets in life insurance bonds or UK pension schemes and intend to utilise the flexible and often tax-efficient withdrawal facilities associated with such structures.

“The potential irregularity of payments and the fact some of these may not be regarded as wholly constituting income could have consequences in terms of meeting the sufficient income requirements of a residency permit.

“Some jurisdictions have developed an interpretation that a simple deposit of the income required for the period of the residency permit in an account which can be drawn upon is sufficient. Others are far stricter, expecting to see income in its regular, taxable form, such as earnings, pensions, rentals, dividends or interest.

“These expats will need to take advice on what is effectively a balancing act between tax efficiency and meeting the income stream requirements of the residency permits best suited to them.”

Expats will not be granted a residence visa unless they can demonstrate this income stream and a visa is essential for anyone wishing to spend more than 90 days in an EU country.

Taking advice early is essential, allowing any potential problems to be identified, and addressed, in good time.

Jason Porter is a Director at Blevins Franks Financial Management Limited and head of the company’s new European Emigration Advisory Service. Blevins Franks has been advising UK nationals retiring to France, Spain, Portugal, Cyprus and Malta for over 40 years, through 22 local offices in these countries.

Moving Abroad Checklist

Initial Considerations

Will your partner be travelling with you?

If so, what will they be giving up in your present home and will they be able to continue with their career in your new home? You will need to check whether a separate visa is required for your partner to work or if your visa gives that right. If they are unable to work you will need to decide on the effect on your finances and what alternatives are available to give a fulfilling life (home business, training, voluntary work).

Are you taking family with you?

Moving with family raises many exciting opportunities, but also can create challenges. The HSBC Expat Explorer survey indicates that expat kids can take six months to settle in to their new country (see article). Getting young or even older children to prepare to move and leave their friends and family behind can be a challenge and should be thought through.

The options for education is another area that needs to be thought through.

Moving your child to a new country with a different education system can be a great opportunity to broaden their experience, but if they are close to key exams the timing can make this inadvisable. If you do take your family with you, it is important to decide between joining the local school system or choosing an international school.

Where will you be living?

Whether you will be living in a house or apartment, furnished or unfurnished, these decisions will affect what you need to take with you. The time you are planning to live overseas will also affect whether you should leave your property at home empty, rent it out or sell it. See the article Sell, Store or Ship.