More and more people are accumulating new wealth through gaining stock options as part of their remuneration package. Whether you are fortunate to work for one of the 40% of start-ups that become profitable or work for a large established corporation, the potential financial gain can be life changing. Today, I want to talk to you about stock options and why you should understand what they mean to you.
HOW TO INVEST – What are Stock Options?
By Spectrum IFA
This article is published on: 11th March 2021
WHAT ARE STOCK OPTIONS?
For any organisation you work for, you are likely to get a salary (unless you are volunteering) and, if you are lucky, stock options. Stock options make up a designated number of shares in a company and are designed to give you some measure of ownership in the organisation. They are the right, not obligation, to buy or sell a share at an agreed upon date and price (also known as the strike price). The idea being, if you own some of the company you are working for, then you are more committed to see the company grow, be profitable and stay with the company for a long time.
WHERE DO THEY COME FROM?
Stock options come from what is known as a stock option pool. These tend to be up to 20% of an organisation’s shares and these options are granted to employees and non-employees (typically investors). The initial owners start out with a certain number of shares in the company and effectively create new shares in the company by setting up a stock option pool.
HOW DOES THIS WORK?
This can be confusing, so for illustration purposes, I am going to use an example of a start-up called LIO that is today valued at 2,000,000€, has an initial share total of 5,000,000 and wants to create a stock option pool of 5% for its employees.
With the creation of a stock option pool, LIO now has 5,250,000 shares. Given that the value of the company is 2,000,000€, that means that each share is worth 0.3809€. Now, let’s say that LIO wishes to give an employee, Avery, 1% of the company’s shares as part of their remuneration package. This means that today, Avery’s 52,500 shares would be worth approximately 20,000€.
A few years into the future, LIO is bought and is valued at 20,000,000€. At this point, Avery decides to exercise his right to buy the shares. He would not have to pay the 3.809€ per share that they are now worth, but at the strike price of 0.3809€. Avery’s gain would be the difference between the two numbers multiplied by their shareholding, meaning that they would have made approximately 180,000€ thanks to the buyout.
I have oversimplified things for the sake of illustration. However, this is what happens in essence, even in large, publicly traded companies.
WHAT DO I DO IF I HAVE BOUGHT SHARES?
The technical term is vested. So, if you have done this and hold shares, then you may be liable to tax on those shares and we will see if we can work towards a solution for you. If you live in Belgium or Luxembourg, we can definitely help.
This article is intended for general guidance only and is based on our understanding of Belgian tax law. It does not constitute advice or a recommendation from The Spectrum IFA Group.
Cryptocurrency Taxes in Spain
By Chris Burke
This article is published on: 10th March 2021
10.03.21
As new investment types become more popular, people generally get in touch with me about them. That is certainly the case with cryptocurrencies such as Bitcoin, and that now large investment firms are starting to invest (Blackrock for example), more people feel comfortable in also investing, or researching whether they should.
Many years ago, due to the technology (or lack of) available, it usually took some time, even a decade or so, for new companies and investments to become well known, sustainable or very successful. Now, with the exponential growth of technology, automation and social media, companies can go from almost zero to mega over a period of months or years. As you may have seen recently in the news with the commodity silver and the company GameStop, technology has become so powerful that groups of people communicating on social media can even ‘manipulate’ investment prices themselves, whether this be a good or bad thing. However, this also creates careful considerations when contemplating investing in these hyped assets.
You need to be very aware that these relatively young and very popular assets show an incredible amount of volatility, and therefore risk. This in itself is not a problem, just as long as you understand it. Investing in anything like this, and I would put cryptocurrency and Tesla or the like into that bracket, as fantastically as they can go up, they can also come down. So the golden rule to consider is, do not invest any monies you are not prepared to lose. Imagine you are walking in to a casino and have a figure in mind that you are going to gamble with; after it is gone you are prepared to walk away without it. That amount can be whatever you like, but you have to understand you can make an amazing profit if things go your way, or, you could lose almost all of it. As long as you are aware and accept this, then you are comfortable to invest in it.
I meet more and more people who have invested in these areas and then require help in taking their sometimes life changing gain to having it managed at a much lower risk level, consolidating and securing that gain. They have made their money, there is no need to keep the risk level that high, cash some if not all ‘out’ and use your ‘winnings’ to permanently change your life. For example, if you went to the casino and won a life changing amount of money, say €250,000, would you return the following week and carrying on gambling it? At what point would you ‘cash in your chips’ and take the reward? The probability still stays at 50/50 each day whether you win or lose, so, until you have ‘cashed in’ your chips, your high-risk level is still there. By de-risking, you are guaranteeing some of that gain and reducing your exposure.
What about taxes on cryptocurrency?
In October last year, the Spanish government brought in greater controls for this kind of investment. In real terms, this means if you buy, sell, transfer, exchange or use to buy something with it they want to know. However, there is only a taxable event when you dispose of this type of investment.
In terms of the tax to pay, this would come under savings tax in Spain (or capital gains tax as it is also known). These rates are currently:
• From 0 to €6000 you pay 19% in tax
• From €6001 to €50000 you pay 21% in tax
• From €50001 to €200,000 you pay 23% in tax
• From €200,001 + you pay 26% in tax
This is only on the gain/profit you have made, not the amount you sell.
Key considerations to take into account
Cryptocurrency is also applicable under wealth tax in Spain, should the region you are tax resident in be applicable to this.
If your cryptocurrency investment should incur a loss, these can be offset against any gains you have over the next 4 years, so that is something important to bear in mind.
Buying using cryptocurrency
If you sell cryptocurrency and buy another investment type having made a profit, then this would be taxed as a gain at the above rates. If you use Bitcoin to make purchases for products or services, then 21% IVA (VAT) tax would also be applicable.
If you do not make the relevant declarations or pay the necessary taxes, large penalties and fines will apply, so you must make sure you not only do this, but perform it correctly.
If you would like help in looking into investing in Bitcoin or other cryptocurrencies, would like help declaring these correctly, or would like to take your already gained profit as tax efficiently as possible and have it managed professionally, don’t hesitate to get in touch.
Time not timing – investing for the long term
By Michael Doyle
This article is published on: 8th March 2021
08.03.21
We often get asked the question, “When is the best time to invest my money?” Our answer is never based around when you should invest, but rather how long you can invest for.
• No one can predict the top or bottom of any market.
• The market has always exceeded its previous high when it has recovered.
So the question is not when you should invest your money in the market, but how long can you stay in the market to achieve your financial goals? Or to put it more simply, time is more important than timing.
During periods of stockmarket volatility, investors often become uncertain and lose sight of their initial long-term investment view. They often find themselves postponing a new investment, or even selling their current holdings with a view to re-invest when the markets stabilise.
What often happens in times of trouble, however, is that investors sell at a lower price than that which they bought at.
A study by Dalbar in Boston USA, highlighted a key area for private investor’s underperformance:
• According to Dalbar, from 1985 to 2004 the average personal investor achieved an annualised return of just 3.7% while the S&P500 returned 11.9% and inflation averaged 3%
A further study showed that playing the waiting game could cost you dearly. Investors who remained fully invested in the UK market over the period March 2003 until March 2008 would have received returns in excess of 60%. However, those investors who tried to time the markets would have had their returns cut to 40% if they missed out on the best 10 days of the market and those who missed out on the best 40 days would have seen returns of 4%!
This applies across other major markets as the table below shows:
| MARKET | INDEX | FULLY INVESTED | MISSING BEST 10 DAYS | MISSING BEST 40 DAYS |
| UK | FTS All Share | 63.4% | 40.0% | 3.9% |
| US | S&P 500 | 56.4% | 11.6% | -39.2% |
| GLOBAL | MSCI World | 63.7% | 21.6% | -26.2% |
Sources: JP Morgan Asset Management/Bloomberg/Datastream
What we do know is that historically the markets have always recovered, as the table below shows.
| EVENT | DATE | RESPONSE | AFTER 4 MONTHS |
| Pearl Harbour* | December 1941 | -6.5% | -9.6% |
| Korean War | June 1950 | -12% | +19.2% |
| JFK Assassination | November 1963 | -2.9% | +15.1% |
| Arab Oil embargo | October 1973 | -17.9% | +7.2% |
| USSR in Afghanistan | December 1979 | -2.2% | +6.8% |
| 1987 Financial Panic | October 1987 | -34.2% | +15% |
| Gulf War | December 1990 | -4.3% | +18.7% |
| ERM Currency Crisis | September 1992 | -6% | +9.2% |
| Far East Contagion | October 1997 | -12.4% | +25% |
| Russia Devalues Rouble / Long Term Capital Management Crisis |
August 1998 |
-11.3% |
+33.7%
|
| World Trade Centre | September 2001 | Dow -14.3%
Nasdaq -11.6% |
+5.9%
+22.5% |
*(The markets rose 8% during the year following Pearl Harbour)
Essentially what we can conclude is that most investors do not buy and hold for extended periods of time. Thus getting in and out of the market at the wrong times or switching funds with a view to chasing the top performers, unfortunately at a time when these ‘top performers’ have reached their peak.
Almost without exception, successful investment strategies rely on discipline, patience and taking a long-term view. Successful investors typically neither react to short market events, nor try to pre-empt short term market direction.
For advice on an investment solution aligned with your personal objectives and risk profile, feel free to contact me for an initial discussion.
Is your money safe under the mattress?
By Katriona Murray-Platon
This article is published on: 5th March 2021
05.03.21
March is my favourite month of the year, not least because I celebrate my birthday during this month and this year will be the end of my 4th decade. Traditionally it has always been a busy month because it is a great time for events and starting new projects. This month my colleagues and I will be attending another virtual property fair hosted by Your Overseas Home. The event we did last year was very good and lots of people were able to see our presentations and then chat to our advisers from the comfort and safety of their own homes.
By October 2021 I will have lived in France for 18 years continuously, but I first arrived for my Erasmus year in September 2001 making it 20 years since I started living in France. As you may know I am married to a Frenchman and I have adopted much of the French culture and way of life. But my husband and I have very different views in our attitude to risk and finances. My husband came from a farming background where money was hidden under the mattress, you only bought when you had the money and you insured everything that could be insured. My husband will take a 10 year extended guarantee on a toaster! I came from a background where it was common to use credit cards to fund Christmas and holidays and I went to university with a student loan.
The idea that money is safe under the mattress or in the bank is no longer true. In France the traditional popular savings accounts such as the Livret A and LDD now only have an interest rate of 0.5%. The other misled belief that French assurance vie policy holders have is that Euro Funds are a good investment and a safe investment. Whilst it is true that Euro Funds are still one of the least risky investments after the traditional bank savings accounts, their performance continues to drop year after year. The average growth rate of the Euro Funds in 2020 is 1.2% which, once you deduct social charges (17.2%) and take into consideration inflation (0.5%), the net gain is only 0.5%. One of my own French assurance vie policies, which is 69% Euro Funds, has made an average of 1.6% over the seven years since it was created. The problem with French assurance vies is that they are not bespoke; they come with certain formulas, some that you can contribute to monthly, some that you cannot, and depending on your choice you cannot go lower than the prescribed amount in Euro Funds, no matter what your risk profile.
When I compare this with the range of product providers we can offer our clients and the choice of funds, the difference is astounding. Thank goodness that as English speakers we have access to better investment possibilities from as little as £20,000/€25,000. The average performance of my clients’ portfolios is around 3% after charges, with no social charges taken at source, and they have a lot of choice and flexibility regarding which funds they want and how much of that fund they want their investment to be in. They also have access to English speaking product providers, English speaking fund managers and their own English speaking financial adviser who is supported by the knowledge and experience of all of the Spectrum advisers.
I am fully integrated into French society and believe in adhering to many things about French society, but when it comes to finances there are differences between us that we cannot ignore so it is not in our best interest to invest in French financial products.
The outlook this March is thankfully much better than last March. There is more good news for Prudential policy holders. At the end of February Prudential announced no changes to the Expected Growth Rate and upward Unit Price Adjustments in the PruFund Growth Sterling, PruFund Growth Euro and PruFund Cautious Euro funds.
For other funds and the markets in general the outlook is equally positive. “The combination of vaccine roll-out, substantial fiscal stimulus, and elevated consumer savings should drive a sharp recovery in economic and earnings growth,” said Ryan Hammond, a Goldman Sachs strategist, in a report this week.
Whilst mask-wearing and social distancing will still be necessary for some time to come, a lot of our friends and family members have been vaccinated, therefore reducing the risk to the most vulnerable. With the coming good weather, meetings and get togethers will be able to take place out of doors. As always, if clients are happy to arrange a face to face meeting, I look forward to seeing them for outside meetings in their lovely gardens. If however you prefer video meetings or phone calls that is also possible.
Wishing you all a bright, sunny and floral month of March!
Your Expat Guide to Pension Planning
By Michael Doyle
This article is published on: 4th March 2021
04.03.21
Are you planning on retiring in France or Luxembourg but have a pension in the UK?
Look no further than this article as we guide you through your options. Pensions are a pinnacle part of your retirement plan but can be a complex topic for British expatriates with rules frequently changing, so always consult with your financial adviser when deciding which plan best suits your needs.
First off, you can leave your pension as is in your existing UK pension scheme if you want. However, with the Brexit decision, you should check with your UK financial adviser and make sure they can still support you. If you want to move your funds to an international pension plan, then your best options may be opening a QROPS or SIPP account.
QROPS (Qualified Recognized Overseas Pension Scheme) allows foreign nationals who have worked in Britain to transfer their UK pensions overseas.
- Expatriates can avoid various restrictions imposed by the UK when taking retirement benefits
- HMRC allows individuals to access 100% their pension fund after the age of 55. However, it may not be advisable to do so as it can result in higher taxes on withdrawals. It is potentially better to draw the funds periodically in a more tax-efficient manner
- There’s no compulsory annuity purchase
- Reduction in currency risk because QROPS allows you to invest and take benefits in a currency of your choice
- QROPS gives you more freedom to select a portfolio suited to your needs because it offers a more extensive range of investment options
SIPP (International Self-Invested Personal Pension) enables someone access to greater investment choices because it is a personal pension plan based on making your own decisions. However, the pension structure is based in the UK so it’s subject to any legislative changes made by the UK government.
Benefits include, but are not limited to:
- An international SIPP can provide a regular or variable income
- No obligation to purchase an annuity
- They provide greater flexibility regarding investments, tax benefits, and currency choices
- Ideal way to consolidate various personal pensions, which reduces administrative complications
- If you plan on moving back to the UK this option may be most suitable for you
You can also try a combination between both UK and international pension plans. The main objective is to arrange your retirement in a manner where you can access your finances when you want, where you want, and in the currency of your choice. Overall, there are many things to consider when choosing your pension plan, so be sure to do your research and understand your different options before making any decisions.
It is in your best interest to act now when planning your pension scheme, so touch base with your financial adviser today to discuss your options.
Beyond Brexit… What comes next ?
By Occitanie
This article is published on: 4th March 2021
Welcome to the ninth edition of our newsletter ‘Spectrum in Occitanie, Finance in Focus’, brought to you by your Occitanie team of advisers Derek Winsland, Philip Oxley and Sue Regan, with Rob Hesketh now consulting from the UK.
In this our first newsletter of the year, it is appropriate we say a fervent goodbye to 2020 and look forward to what we all hope will be a better and much kinder year. Although we are heartily sick of hearing the B-word, we can’t let the passing of the UK’s exit from the European Union pass without addressing the question “where do we stand now?” We also invite our investment partners to give their views on the markets for the coming year.
Post Brexit Situation
As far as financial services are concerned, it is (at this stage) a no-deal Brexit. Financial services in the UK employs 1.1 million people, yet so far more time has been spent negotiating fishing rights than financial markets access between Europe and the UK. This financial services relationship between the two sides will be discussed and negotiated over the coming months. What does this currently mean for us expats? We have already seen:
- Banks threatening to close down bank accounts, because they struggle to find solutions for the ongoing servicing of non-UK resident account holders.
- Financial institutions no longer being allowed to ‘passport’ their services into Europe – UK based investment managers, and Independent Financial Advisers (IFAs) being just two examples of this. To continue to offer services, each must now open European offices and apply to be regulated through the relevant EU regulatory system
- We’ve seen the application of duties to goods imported from the UK from online shopping, a totally new concept for most of us
- The need to apply for a French Driving Licence
These are but a few of the bureaucratic changes brought about by Britain’s exit from the EU.
We have covered some of these Brexit consequences in previous editions of our newsletter, but there is perhaps a more serious implication for those who hold UK investment bonds.
Why are UK Investment Bonds a problem?
Prior to Brexit, as investment bonds issued in an EU country, UK bonds were treated in the same way as assurance vie policies, with only the gain element of the investment subject to income tax and social charges. How quickly your local tax office recognises that this situation has now changed will vary, but in time it is inevitable that questions will start to be asked regarding those withdrawals that you are taking to support your lifestyle.
Why should that bother me?
As a non-EU qualifying bond, your local tax office could, as a worst-case scenario, treat the whole of any withdrawal as taxable income unless the split between capital and gain can be proved. It is more likely, however, that withdrawals from UK bonds will still only be taxable on the gain element, but the taxpayer will no longer benefit from the favourable tax treatment that the assurance vie enjoys, such as the annual tax-free allowance of €4,600 (€9,200 for a couple) after 8 years and the preferential 7.5% rate of income tax. We urge all our readers to assess their current savings and investments, to ensure that they are all France tax compliant. We can help you with those assessments.
What can we expect from investment markets this year?
We have invited one of our investment partners to give us their Investment Outlook for 2021. These are the views of Tilney Smith & Williamson that we would like to share with you.
A review of a tumultuous 2020
The investment landscape in 2020 has been dominated by the COVID-19 virus, lockdowns and unprecedented policy easing by Central Banks and governments around the globe. The US election and UK-EU negotiations provided further risks to markets. The pandemic led to a global economic shock that established new multi-generational records. For instance, UK GDP fell by over 11% in 2020, the biggest decline since the Great Frost of 1709 (1).
In financial markets (2), the MSCI All Country World equity index fell 32% in total return terms (including dividends) once COVID-19 new cases spread outside China, while government bonds outperformed as investors became more risk averse. The low point came on the 23 March prompting the Fed to say that it was prepared to buy US corporate bonds as part of a new round of quantitative easing (e.g., asset purchases). Global equities then went on to rally 63% from the trough, supported by – at various points – fiscal and monetary stimulus, economic recovery and hopes of a successful vaccine rollout, to close out the year up 15%.
The main winners of 2020 were ‘growth’ equities and direct COVID beneficiaries such as Big Tech, following widespread adoption of e-commerce and working from home practices. Long-term government bonds benefited from central bank asset purchases. In turn, gold gained from concerns about the debasement of the fiat currency system from money printing: the US created 21% more dollars in 2020 than existed previously. Despite the virus originating in Wuhan, China was one of the quickest economies to re-open and MSCI China equities rose 28%. China’s economy benefitted from lockdowns in the West, since services were restricted, but buying goods was not. China even managed to boost its share of global merchandise exports, driven by stimulus in the West creating demand. The biggest losing sectors were energy (-32%), real estate (-9%) and banks (-11%), with the COVID-exposed UK and Eurozone the laggards in geographical terms.
Reasons to be optimistic in 2021
We maintain an optimistic outlook for equities for several reasons. First, the rollout of vaccines and a gradual opening up of economies from lockdowns should encourage households to run down savings rates to sustain consumption.
Second, we expect a synchronised broad-based global economic recovery that supports company earnings. The IMF forecasts that a record 79% of nearly 200 economies will experience growth higher than 3% (3) this year. Not only would this recover much of the lost output last year, but it adds support to consensus global Earnings per Share growth of 28% expected in 2021.
Third, central bank liquidity is still projected to remain highly accommodative. The ECB topped up its pandemic emergency purchase program by €500bn in December to €1,850bn and extended the horizon of net bond purchases to the end of March 2022 (4). In a major policy change in September, the Fed made clear that it intended to “run hot” with regards to maintaining easy monetary policy in order to achieve above 2% inflation (5). Morgan Stanley forecasts that the combined balance sheet of G4 central bank assets will rise by $3.4trn by the end of 2021(6).
The UK and Brexit
Despite the widespread recovery in global risk assets, all UK equity indices were laggards, handicapped by the ongoing Brexit uncertainties and a compositional skew towards value orientated economically sensitive businesses. Should current assumptions over a vaccine inspired economic rebound prove correct, it seems probable that this skew, allied to the removal of Brexit trade uncertainties, could give rise to some relative recovery in UK equity valuations. However, with the longer term balance sheet impact of the Covid lockdowns still to be fully understood, remaining focused on the fundamental quality of the businesses selected, even in an ostensibly cheap market remains paramount.
Risks to the outlook
In terms of the risks, we continue to monitor: i) a sudden removal of accommodative policy, perhaps if inflation returns at a pace that exceeds central bankers’ expectations, ii) fears of another COVID-19 surge, or a disappointment in the effectiveness in vaccines/a mutation to a more virulent virus, iii) social unrest in the politically polarised United States, and iv) extended valuations in some sectors triggering a broader market rout.
As a reminder to our readers, Spectrum is a registered French company, regulated in France. We are not passported in from the UK, so for us it’s business as usual.
For those of you who still have investments in the UK, whether they be stocks and shares ISAs, investment bonds, pension funds or other investment portfolios, now would be a good time to review these and discuss with your provider as to whether they will be able to continue advising you in a post-Brexit world. Even if your UK provider will be able to continue advising you, they may not be familiar with the French taxation framework and the investments you hold may not be tax efficient in France. We can advise you on investment products that are suitable and tax-efficient for living in France and provide you with ongoing advice to ensure that your financial plan remains on track as your situation and attitude to risk change over time.
Please do not forget that, although we may be restricted on where we can travel at present, we are here and have the technology to undertake your regular reviews and financial health checks remotely. If you would like a review of your situation, please do not hesitate to get in touch with your Spectrum adviser or via the contact link below.
We would love to hear from you with any comments and/or questions, as well as suggestions as to future topics for our newsletter. Please feel free to pass this on to any friends or contacts who you think might find it interesting.
UK pensions and investments after BREXIT
By Andrea Glover
This article is published on: 25th February 2021
25.02.21
After several years of uncertainty, the UK has now fully left the EU and whilst many of us understand exactly what that mean in terms of French residency requirements, the impact on the financial services world is only just starting to unfold.
We asked Andrea Glover, International Financial Adviser at The Spectrum IFA Group, for her thoughts on the matter and to provide guidance to those of you who are affected.
Andrea explained “Brexit ended automatic ‘passporting’ rights for UK financial services in the EU. So, if you either live in France or are looking to move to France, it is important to check that, if you have a UK financial adviser and/or UK insurer, that they can still support you.”
Andrea commented “For those of you living in France, contact your UK financial adviser if they have not already been in touch and ask if they are still able to provide financial advice to you as a French resident. Also, ask your UK insurer if they have put in place measures to ensure that your policy or pension can continue to be serviced. Your insurer or financial adviser should always act in your best interests. It is also important to note that in the case of a dispute with your insurer or financial adviser that you might not be able to refer the problem to an ombudsman or court in France.”
Andrea continued “My advice would always be to seek advice about the rules, from a French tax perspective, for any pensions and investments held in the UK and check that anyone offering you advice, or financial services, is authorised to do so in France. Further, a suitably qualified financial adviser who is based in France will undoubtedly have first-hand experience of living in France and therefore have greater empathy with their clients.”
Andrea went onto say “Giving advice on UK held investments and pensions is only one component of comprehensive financial planning. A qualified financial adviser will also be able to provide guidance on matters such as Inheritance Tax planning in France and look at alternative tax efficient investment vehicles such as an Assurance Vie.”
For those of you looking to move to France Andrea explained further “Moving to France as a UK citizen is obviously more onerous than previously in terms of residency. I believe this places even greater importance on seeking suitable financial advice before any firm plans to move are finalised.”
From her own experience, Andrea commented “We are receiving a number of enquiries from people looking to move to France, which is firstly encouraging but secondly it means that we can really help clients structure their financial affairs efficiently before they move. We quite often work in partnership with international tax lawyers to assist clients who, for example, have a business in the UK but want to run it from France. Having a clear and defined plan, after seeking advice from the suitable experts, prior to any move to France, is undoubtedly beneficial and avoids any nasty surprises further down the line.”
*This article first appeared in The Local Buzz
Fund managers, ethics, green issues and sustainability
By David Hattersley
This article is published on: 18th February 2021
18.02.21
The impact of both Brexit and the Covid 19 pandemic have given us all time to reflect on the world we live in. As consumers in the developed world, we are perhaps more aware of the impact we make on our planet. The words “Sustainable” and “Ethical” spring to mind.
So where does one stand on ethics and sustainability? As individuals, it’s very easy to say “we are Green”, but then travel 70km to stock up on our favourite brands of frozen convenience meals. Most of us, due to “lockdown”, now spend more time cooking and preparing our meals at home.
How far are major companies prepared to change too? Coca Cola has announced plans to make a paper bottle and already has a prototype that can be recycled, which was developed in the Brussels R&D centre. But, whilst that is a very applaudable, one company has gone even further.
I have to admit that there is an affection for them as I worked in one of their divisions for two years prior to a career change to Financial Services. One of the biggest global consumer companies which operates in 190 countries is Unilever. “Love or loathe it” to paraphrase Marmite, they have taken what some may consider a risky strategy. Not only do they try to ensure that the raw materials that go to make their products are as green as possible, they have taken what may be considered a leap of faith. Sustainability and ethics are not only about “green principals”. They are insisting that every part of its global chain of suppliers provide a “living wage”, and in some cases double that, by 2030. These include smallholder farmers as well major direct suppliers numbering in total 60,000. As the CEO, Alan Jope, said in a statement on the 21st Jan 2021, “The two biggest threats that the world currently faces are climate change and social inequality.”
As part of a developed area of the world we should all make a choice. Do we support the ethics of a company that is looking to redistribute wealth and act in an ethical, sustainable way, or do we just look at price rather than value? Have the events of the last year been our wake up call? Morally, rather than just looking at saving tax, or short term political gain and expediency, we should consider what the real legacy is that we leave our children and grandchildren on this planet that we share.
The same questions will be applied by our fund managers, in particular those that focus on ethics, green issues and sustainability. Are they the best choices for the future? I believe so. These specialists have far greater resources than I could ever have to research this “new world” we are entering, and are better equipped to look at the longer term than I am. I would be happy to provide a portfolio of these specialist funds to anyone who is interested, so feel to contact me on any of the points raised.
Prochaines échéances fiscales et guide 2021 des impôts en Espagne
By Cedric Privat
This article is published on: 15th February 2021
15.02.21
Que vous viviez en Espagne depuis de nombreuses années ou que vous soyez un nouvel arrivant, vous êtes soumis à certaines déclarations obligatoires et devriez donc être concernés par une ou plusieurs échéances listées ci-dessous.
Ces dates sont inchangées depuis plusieurs années et devraient le rester.
Modelo 720
Déclaration informative mais obligatoire sur les biens et avoirs à l’étranger. Vous devez présenter ce Modelo 720 si la somme de vos actifs est supérieure à 50 000€ dans une ou plusieurs des trois catégories:
- Comptes bancaires situés à l’étranger
- Titres, droits, assurances-vie et placements gérés ou acquis à l’étranger
- Biens immobiliers et droits sur les biens immobiliers à l’étranger
Les années suivantes, il n’est demandé de représenter le Modelo 720 qu’en cas d’augmentation de plus de 20 000€ par rapport au capital initialement déclaré.
Des sanctions sont possibles en cas de non respect de cette déclaration.
À déposer avant le 31 mars.
Déclaration De La Renta
La déclaration d’impôt se fait entre les mois d’avril et juin. Vous pouvez soit l’effectuer directement sur internet, soit prendre rendez-vous avec un
conseiller du Trésor Public (Hacienda), soit léguer cette tâche à un “gestor” (conseiller fiscal).
L’année fiscale en Espagne va de janvier à décembre, vous déclarez donc vos revenus de l’année précédente.
En Espagne les impôts étant prélevés à la source, Agencia Tributaria n’effectuera qu’une vérification. Dans la plupart des cas, vous ne paierez pas de supplément.
À déposer avant le 30 juin.
Impuesto Sobre El Patrimonio (Catalogne)
Impôt sur le patrimoine: cette déclaration est obligatoire si votre patrimoine brut (sans déduction
des dettes) est supérieur à 2 000 000€ ou votre patrimoine net supérieur à 500 000€.
La résidence principale est exonérée jusqu’à 300 000€.
À déposer également avant le 30 juin.
Afin de vous aider à mieux comprendre la fiscalité en Espagne, Spectrum a créé le “Guide des impôts en Espagne 2021” (document en anglais).
Ce guide vous aidera à comprendre les règles de résidence fiscale locale et les impôts sur le revenu, les successions, les investissements, la propriété et les retraites.
Vous pouvez librement télécharger ce document sur notre site et dans le même temps, si vous le désirez, vous abonner à ma newsletter “actualités financières et fiscales en Espagne”.
spectrum-ifa.com/cedric-privat/spanish-tax-guide-cedric-privat
Je reste à votre disposition pour vous apporter des informations complémentaires.
New Spanish bank charges post-Brexit
By John Hayward
This article is published on: 11th February 2021
11.02.21
If you bank with Sabadell, you may well have noticed that they are charging you for transfers in and out of your account. Although you may have an account that didn´t attract changes before Brexit, it could do now. When approached by a client of mine, who has a Premium account with Sabadell, their response was, and I paraphrase “because we can”, using the Bank of Spain rule book to justify the charges. It is because the UK is no longer in the EU. It appears that these charges are being applied to ad hoc transfers as opposed to regular payments such as pensions.
I have heard of other instances where transfers have been made from the UK using a currency exchange company. Currencies Direct, for example, have stated that they will cover the charges made by banks as they feel that it is incorrect and goes against the SEPA (Single Euro Payments Area) agreement, challenging the actions of the banks.
Solutions
- Close the account with Sabadell. (This is probably not convenient for many)
- Tell Sabadell that you will close the account if they continue to charge. (You will probably not get too much of a reaction to this one)
- Instead of transferring money as and when required, which is something many people do, set up a regular payment.
- Make transfers via companies where you can have an account in GBP and another in Euros. When the money is received or paid by Sabadell in Euros, from or to an EU based account, they do not charge.
I understand that other banks are also making charges when they did not before Brexit, so check with your bank. You do not have to just accept what they are doing.