There are a vast variety of expat investment options that are typically available for UK residents and non-expats alike. There are many forms of expat investments; they can be onshore investments or offshore ones; however, expats prefer the offshore investments because of the tax benefits it brings them. There are also some issues wherein some forms of investments cannot be readily available for those living outside the UK. Harrison Brook can help you by providing expat investment advice, tailored specifically to you.
The expats’ curiosity for investing has grown steadily over the past years, which means that it is within everyone’s best interest that a qualified financial and investment adviser be on board. If you find yourself unclear about your next action or decision, then it would be best to find someone you could trust and get independent advice from. Expats usually opt for different types of said products and Harrison Brook’s financial advisers provide trustworthy and transparent financial advice to expats around the world.
Individual Savings Account and Expats
Typically, for many local residents, an ISA is the best option because it provides a safe, convenient, and efficient investment product. However, if you are a foreigner or if you live internationally, opening an ISA would be difficult.
If you plan to leave the UK but want to hold an ISA, it would be on your best interest to explore the taxation benefits and regulations of the new country you will be living in. For expats already holding ISAs, it would be the most sensible route to explore different options that would be much beneficial to you in the long run.
Many expats use local high street banks to build their savings. This may seem like savvy saving, but with interest rates at record lows, once inflation and the rising costs of living are taken into account, the future buying power of these hard-earned savings is in fact hugely depreciating.
If you are a non-UK resident or an expat, offshore bonds typically found on the Isle of Man or Guernsey would also be readily accessible to you. A bond is essentially a life insurance containing a different number of investment funds. For expats, it is an efficient option in terms of tax as the bond will not be an issue when it comes to capital gains tax and income tax deferred. This means that the value of the investment itself would grow because it will be free of tax, even if the expat returns to the UK. However, in some situations, offshore bonds will still have to account for withholding tax that cannot be reclaimed. The rules of income tax and income taken from the bond will depend on the country the investor lives in.
Offshore bonds can also be treated as return of capital rather than an income, which can be withdrawn each year up to 5% of the investment. The money will be taxed as income in the country of residence at the time of the withdrawal. It is important to note all the technicalities that are involved with investment bonds from the charges down to the commissions. It is crucial to seek financial advice before making any decision about your offshore investment bond.
Harrison Brook provide complete lump sum investment and portfolio management for expats looking to make financial investments.
Pensions, QROPS, Properties, and other alternatives
Investment in a pension scheme is a very tax efficient savings plan that provides financial stability in the later years of life. The investor may manage these investments or an adviser and manager assigned to the plan. For those with larger pensions, they can opt for a Qualifying Recognised Overseas Pension Scheme or QROPS, which enables a non-UK resident to transfer a UK pension out of the UK.
Similar to a pension plan, investments in properties are quite common in an investment portfolio. For expats, these may include their primary residency and other properties which account for some of their rental income. In the UK, expats can experience difficulty securing additional properties and only those who can outright pay for a property should be qualified to do so.
If you plan on securing a property, however, it is also important to note that a financial manager for the property should be hired to be able to properly regulate all the fees, tax, and rental income. It is also important to know that any income from rental of property should be subjected to the UK income tax.
Investing through an international bank is another means of acquiring investment for expats. However, your options may be restricted to the rules and regulations of the bank despite going through an independent financial adviser first. Always check with your international bank the restrictions and limitations for investing.
Acquire solid expat investment advice
Always look for solid advice when it comes to any financial investments. If you are an expat looking to invest, make sure you look into all your options before making an informed decision. Get in touch with a Harrison Brook financial adviser today to discuss your financial investment requirements.