Tel: +34 93 665 8596 |

Viewing posts categorised under: ISAs

UK investments living in Portugal

By Mark Quinn
This article is published on: 2nd August 2022


Can I keep my UK bank accounts, Individual Savings Accounts (ISAs) and other investments?

Moving to a new country is exciting, although it does present challenges. New processes, bureaucracy and language, but it also may mean you have to reshuffle your finances.

Each person should seek individual advice when it comes to financial planning, but here I touch on commonly held assets, the main points that you should be aware of and what you can do about them.

Bank accounts
Whilst many expats will open a new bank account in their new country, most of us also keep our UK bank accounts, not only for practical reasons but also because we understand and feel comfortable holding them.

However, post-Brexit many UK banks are asking account holders living outside of the UK to close their accounts. This can pose a problem because if you have already moved to Portugal, it is unlikely that you will find an alternative UK bank that will be willing to accept new non-UK customers.

The Channel Islands and the Isle of Man are popular alternatives to the UK when it comes to banking, but you should be aware that these are considered ‘blacklisted jurisdictions’ by Portugal and therefore interest is taxed punitively at 35%, rather than the usual 28% or 0% under NHR (Non-Habitual Residence).

Individual Savings Accounts (ISAs)
Firstly, consider the tax dimension. They do not retain the tax exemptions when held by Portuguese residents. For (NHRs), interest and dividends are tax exempt during the 10-year period but realised gains are taxed at 28%. For non-NHRs, interest, dividends and gains are taxed at 28%.

But whether you decide to retain your UK ISA or restructure it will depend on your longer-term plans, some things you might consider are: how long you will stay in Portugal, do you need to make withdrawals, do you want to top up, can you make changes to the underlying investments if a Stocks & Shares ISA, or what are the returns on Cash ISAs?

If your move to Portugal is short-term, or if you are not certain that it will be your long-term home, then there is a case for retaining your ISAs. Although you cannot add to them whilst non-UK resident, you can continue to hold them, and once you return to the UK they resume their tax efficiency.

A planning point you may wish to consider if you have a Stocks & Shares ISA is to ‘rebase’ by selling and then immediately repurchasing the same funds within your ISA prior to leaving the UK to ‘wash out’ any taxable gains accrued to the point of your departure. This way, if you did decide to restructure, encash, or withdraw from the ISA as a Portuguese tax resident in the future, there would be little or no tax to pay in Portugal.

As a general guideline, if you believe your move to Portugal is long-term (as a rule of thumb, 5 years or more) then restructuring and starting an investment vehicle that is suitable for residency in Portugal would make sense for greater tax efficiency, amongst other reasons. If this is the case, planning well in advance is advantageous, as there is no tax on ISA closure for UK residents.

UK investments living in Portugal

National Savings & Investments (NS&I)
NS&I savings and Premium Bonds are popular products held by many UK nationals and are seen as ‘safe and secure’ as they are backed by the UK Treasury.

Aside from this point, they do require you to hold a UK bank account which could be an issue for some. The interest rates offered are low, well below inflation, so you are losing money in real terms and interest is taxable in Portugal, unless you have NHR.

Premium Bonds on the other hand offer no capital growth or income, only the possibility of winning a sum of money. These winnings in turn are taxable in Portugal, not tax-free as they are for UK tax residents – this could be disappointing if you do win that million!

Investments with UK-based Financial Advisers
Most significantly, Brexit brought an end to the passporting rights that allowed UK-based advisers to advise clients across the EU member states and vice versa. This means that many advisory firms may not have the right permission to continue providing advice to clients living overseas.

Obviously, this can be worrying for those who have worked alongside their trusted adviser for many years, but in reality, good financial planning and structures for UK residents are unlikely to retain the same benefits for those living outside of the UK.

Understandably, many UK advisers do not want to lose their clients, and whilst you can continue your relationship with your UK adviser and pay their fees, without the right permissions, you should be aware that they cannot service your accounts e.g. provide investment advice for portfolio rebalancing or fund switches, and more importantly, you might not have proper recourse if anything were to go wrong. This will not only affect your investments and performance, but you will end up paying for advice that you cannot (legally) take advantage of.

Likewise, if you hold offshore investments provided by EU institutions, they may not be able to accept instructions from a UK-based adviser if they do not have the right licenses.

Lastly, there are practical implications. Does your UK adviser understand the rules in your new country of residence? Are you missing out on tax planning opportunities, paying more tax than you have to because you could be structuring or drawing your income better, or have they fully understood the knock-on effect of their advice in relation to income tax, interaction with NHR, or taxes on death?

What can you do?
The overarching message is that Brexit has changed the landscape for establishing and maintaining our investments. Reviewing your personal finances is more important than ever to ensure that you are not hindered when managing and making changes to your investments and savings, but that you are fully protected and have recourse should anything ‘go wrong’.

We are UK-qualified Chartered Financial Planners and tax advisers, so have a firm grasp of the planning and issues UK expats face. We have also been living and working in Portugal for a combined period of 15 years, so we not only understand the local rules and regulations but also have vital local experience and knowledge. If you would like an informal, confidential initial chat at no cost to you, please get in touch.

The Changing Financial World

By Alan Watson
This article is published on: 18th October 2019


It was December 15th 1996; my wife and I were happy to be in Morzine and were enjoying dinner at hotel Les Airelles. Jean-Claude, the owner, was very attentive – we were his only guests! Heavy snow was falling, so the drive back to our home in Le Biot was a slow one, spotting just one other vehicle parked suspiciously in St Jean D’Aulps, the Gendarmes, who looked bemused that a Dutch plated car should mess up the untouched snow cover.

During Christmas I worked as usual in my IFA business covering Europe, but it was a stress free time; international clients had little to bother them, the main concern being market direction. The FCA did not exist; tax people were only after the big fish; even the Financial Ombudsman, for complaints, was years from formation; regulation was unheard of; QROPS transfers were an age away. The Isle of Man, Guernsey, Jersey, and of course Switzerland were the favourite hiding centres. Clients were happy to deposit large sums resulting from their global company contracts. Banks happily took in and paid out in cash, accepted transfers from third parties, and asked minimal questions to new arrivals in the beautiful French Alps; they were simply hungry for this amazing new flow of business. The financial world was a relaxed place, where large sums of “tax free” money could be transferred to the Notaries, who would inform the local land sellers that they had become wealthy; keys were given, dreams were realised and that much expanded supermarket just out of town saw the wine shelves emptying like never before. Travel businesses sprung up with sexy names like, “Utah snow and sun”, and their chalets were full the whole winter. The French tax people started to scratch their heads. Not only were local people driving back and forth through the Swiss border every day, but now a new irritation had arrived in town and some serious checking was necessary. The French Fisc. suddenly had many more employees, serious computer power, and somebody could apparently speak ENGLISH !

It’s now October 2019, my wife and I still love to eat in Morzine, but things have changed. Conversations with my clients all over the Rhone Alpes region take on a very different and focused tone. A global directive of information exchange requirements has shaken up the old world called CRS, “Common Reporting Standard”, which means the UK will exchange all financial, bank account, insurance policy and investment account information with France. Even that renowned haven of Swiss Private Bankers are happy to flood Europe’s tax offices with full financial disclosure information on former residents and clients. If that’s not enough, I regularly hear of clients being pestered by cold calling IFAs based in Paris, the south of France, even Dubai. The pleasure of being seen on social media! But now the approach is somewhat different, we have tight European regulation, or do we?

Making life changing investment decisions is a delicate operation. If somebody tells you they are part of XX group in Gibraltar, but due to “flexible” European financial regulation, they can passport, operate in France – beware: if things go wrong the UK, FCA or French regulator Orias will be unable to help you. A fully regulated French company holds the correct licenses and your chosen adviser should know French rules and regulations, preferably from many years experience in the region. Some individuals choose to keep a leg in the old country, just in case, but this half-half decision could cost you dearly. “Is a UK ISA tax efficient in France?” “My money is 100% Sterling, so impossible to move it over here.”

Your chosen IFA should know a great deal. Test their knowledge on markets, tax issues, currency movements/history, inheritance. Can they introduce you to competent local professionals? Moving from one country to another is a big step. Do make sure all fits into place, you should enjoy this wonderful region for years to come.

UK Investments & ISAs – Tax Treatment in Spain

By Chris Burke
This article is published on: 16th April 2018


With automatic exchange of financial information between most countries now standard practice, most of us already recognise the importance of declaring our assets properly and fully. In the UK, if your accountant or tax adviser declares your assets incorrectly, they are liable; however, that is NOT the case in Spain. I have been contacted by many people with various stories of how their accountants in Spain have reported assets. Sometimes it feels like people are speaking to numerous accountants until they find the one with the answer they want – if the declaration is incorrect though, and leads to an investigation, you are personally liable. Therefore, it is essential to have your assets reported correctly.

It is quite straightforward to understand the Spanish tax treatment of your UK assets. If they are NOT Spanish compliant – that is to say, not EU based and regulated AND the company holding these assets doesn’t have a fiscal representative and authorisation in Spain – then income and investment growth are taxable annually. Note that investment growth on assets such as shares, ISAs and premium bonds is taxable regardless of whether you have taken any income or withdrawals.

Below you will see the main list of investments that need to be declared and the tax rates that apply annually:

Type of Assets/Investment Tax Payable Type of Tax
Investment funds/stocks/shares Yes, on growth Capital Gains Tax (19-23%)
ISAs Yes, on growth Capital Gains Tax (19-23%)
Premium Bonds Yes, on gain/win Income Tax (19-45%)
Interest from Banks Yes, on growth Capital Gains Tax (19-23%)
Rental Income Yes Income Tax (19-45%)
Pension Income Yes Income Tax (19-45%)

Expenses may be able to offset some of the tax on gains, and for long term property rentals you can receive up to 60% discount on net rental income. However, tax reliefs and allowances that applied in the UK are not available to you in Spain.

There are ways of reducing these taxes, by having your finances organised correctly, and in many cases there is also scope to defer tax. This means there is no tax to pay if you are not taking an income or withdrawals from your investment. In fact, the more your money grows, the greater the potential tax saving.

The first thing you should do, and any financial adviser or tax adviser should do, is consider ways of mitigating your tax, both now and in the future. Otherwise you could end up with a ‘leaking bucket’. Many accountants are starting to increase charges for declaring UK assets, which need to be listed individually and where there is often lack of familiarity with the assets held. By the time you have paid the tax for NOT drawing your money, paid your accountant and lost any tax relief that applied in the UK, in most cases there are more cost effective, tax efficient, Spanish compliant options available. Furthermore, for those returning to the UK, there is still generous tax relief which applies to certain Spanish compliant investments.

For an initial discussion regarding your finances and practical guidance on planning opportunities, please get in touch – my advice and recommendations are provided free of charge without obligation –

Taper Relief on Capital Gains from the Sale of Shares

By Derek Winsland
This article is published on: 16th November 2017


My colleague, Sue Regan, in her last article, gave details of a number of tax changes currently being debated in Parliament and which are expected to come into force by the end of the year. On a positive note, wealth tax (Impot de Solidarite sur la Fortune) is to be abolished, to be replaced by a tax on the value of property (Impot sur la Fortune Immobilier) or IFI. This can have real benefit to those with investments outside of property.

Less positive is the intention to abolish taper relief on capital gains from the sale of shares, which includes equity investment funds. This can have serious connotations for those investors holding investment portfolios outside of an Assurance Vie. Portfolios held within equity Individual Savings Accounts (ISA’s) in the UK, for example, will be affected. For UK residents, ISA’s represent an excellent savings and investment vehicle, with ‘income’ drawn from the ISA tax free in the hands of the investor. Growth in the investment attract no capital gains tax charge, irrespective of whether the gains are extracted or allowed to roll up within the ISA.

In the hands of a French tax resident though, ISA’s don’t enjoy any of the tax benefits UK residents take for granted. It is as if the ISA wrapper doesn’t exist. Instead, in France, taper relief is granted on gains made from equities (shares) where the holding is greater than two years. Where shares have been held for two years and up to eight years, the relief is 50%; after eight years the relief rises to 65% under the current system. Crucially, this relief also applies to collective investments where a minimum of 75% is invested in equities.

If you then factor in the fact that all gains are calculated in euros, shares and equity collectives in the UK held for a long time can be further reduced because the purchase price will be converted into euros using the exchange rate on the day of purchase. Likewise, the euro value is calculated on the day of sale. With the value of sterling currently low, the amount of any gain can therefore be further reduced if the exchange rate on the day of purchase is higher than the rate on the sale date.

All of this means that if you are resident in France, holding on to stocks and shares ISA’s in the UK, it really is time you thought about cashing them in, reinvesting the proceeds in the far more tax efficient Assurance Vie. Time really is of the essence.

If you feel you could be affected by this, or have personal or financial circumstances that you feel may benefit from a financial planning review, please contact me direct on the number below. You can also contact me by email at or call our office in Limoux to make an appointment. Alternatively, I conduct a drop-in clinic most Fridays (holidays excepting), when you can pop in to speak to me. Our office telephone number is 04 68 31 14 10.