Emigration Fact Sheet

So you think you want to emigrate?

On an almost daily basis, the national media run stories about the ever-increasing numbers of people wanting to live in Britain. We may be in danger of forgetting that, every year, thousands of Britons leave to start a new life overseas, though not all intend their move to be permanent. Currently, Australia, the US and Spain are the favourite destinations.

People’s reasons for emigrating vary enormously. Many yearn for a warmer climate. Some see more opportunities abroad, whether they are starting their own business or seeking employment, while others work for a multinational company that transfers them to another country. Some want to give their family a better life. Yet others are pursuing a dream of retiring abroad.

Today, many countries (certainly the most desirable ones) have stringent entry requirements for those seeking to live there. Many operate quota systems. Nevertheless, it is still possible to emigrate to certain parts of the world if you have skills that are in demand, family living there or a sizeable sum of money to invest. Some countries only require that you be financially independent.

Emigrating is a huge and complex step. In addition to planning the details of your new life and dealing with citizenship issues, you may well have to sell your home and other UK assets, and perhaps change your financial arrangements.

This may sound off-putting, but moving abroad can be a success if you do your homework and prepare thoroughly. However, a surprising number of people launch themselves into their new life with not much more than a vague idea that ‘the grass is greener’.

Don’t be one of them! However cosmopolitan you may be, and however knowledgeable about your chosen country, remember that this is not just a couple of weeks’ holiday. Be realistic. Ask yourself the tough questions (which will, of course, vary according to your personal circumstances). Are your skills relevant to the employment market, or could you acquire the necessary skills? Is the culture of your chosen country very different from that of the UK? If so, could you adjust? Would you miss family and friends unbearably? And so on. It’s important to be honest and realistic in your answers.

This fact sheet provides a place to start by giving a brief overview of some of the issues to consider when moving abroad. There are many resources to help with further research, including television and radio programmes, books, magazines, the Internet and property exhibitions, as well as estate agents and developers, both in the UK and in your chosen country. Naturally, these are no substitute for on-the-ground research; fact-finding trips to the country you’re interested in, at different times of year, will be essential to the success of your move.

Visas and residency

Countries vary widely in their criteria for granting visas and/or residency to foreign nationals. The degree of red tape is usually proportionate to the number of applications they receive. In the extremely popular country of Australia, for example, the government sets an annual quota, distributed between the categories of skills/business, family and refugee/humanitarian, for granting permanent residence visas. The balance varies, and is influenced by population and skills trends. At present, a shortage of skilled workers, combined with an ageing population, is leading the government to increase skills (particularly business skills) intake and cut down on family intake.

Each category has its own specific requirements. For example, anyone over the age of 45, or without 12 months’ recent work experience (more in the case of some occupations) cannot enter Australia by the skills route. Within each category, there is a range of types of visa, and it is essential to select the type that best matches your personal circumstances, as this will give your application the greatest chance of success.

In contrast, Spain presents a much easier prospect for Britons wanting to live there. When the country joined the EU, the residence card became the only formality required for EU citizens to take up residence in Spain. Recently, the rules have been relaxed still further. Residence cards are now compulsory only in the case of pensioners retiring to Spain, people of independent means (that is, who are not working) and non-EU dependants of an EU national, all of whom must be able to demonstrate sufficient means to support themselves and, if applicable, their families in order to obtain resident status.

There are two categories of residence card in Spain, the temporary residence card (valid for stays of between 90 days and a year) and the residence card (valid for stays of between one and five years, and renewable thereafter). Even those who fall into a category where a residence card is not compulsory may find it useful to have one, as it can help to simplify various administrative procedures for new residents.

This is an area in which thorough research will pay dividends. It’s worth consulting a specialist company for advice on obtaining residency in your chosen country.

Personal finance

Before you make the decision to emigrate, it is essential to ensure your finances are properly planned and that realistic budgets are in place.

Taxation is a complicated subject and one that causes many headaches, even in one’s home country. Naturally, the problems are compounded when dealing with an unfamiliar system. Consult a qualified professional who can advise you of your tax liabilities in the country you are moving to.

The UK has double taxation agreements with many countries. These prevent you from paying tax twice, but you will usually pay it in the country that levies the higher rate. Some countries, including Canada, do not recognise ISAs and other products that are exempt from tax in the UK. If you are in receipt of a pension, you will need to investigate how it will be treated for tax.

Currency fluctuation can be another thorny issue. Anyone considering moving money overseas, either as a lump sum or to make regular payments, should consult a financial adviser or foreign exchange risk expert, who can advise on ways of reducing the risks.

Retirement

Many people dream of retiring abroad. As with other types of residency, regulations vary from country to country.

Florida, for example, is among the most sought-after retirement locations. However, those not planning to work, including retirees, must be able to demonstrate substantial means. This can be an obstacle to many of those seeking to retire there.

Regulations on retiring to Australia have recently been tightened. In 2005, the Investor Retirement Visa replaced the Retirement Visa. This is a temporary visa, and does not lead to permanent residence or citizenship. Applicants must be 55-plus, have no dependants (apart from a spouse), and be able to support themselves independently (that is, without any Australian state aid). Private medical insurance is required.

Another important point to consider is your pension. If you emigrate, your UK state pension may still be paid at the same rate as you would have received in the UK, depending on which country you settle in. Those who retire to a European Economic Area (EEA) country (that is, all EU countries plus Iceland, Liechtenstein and Norway) have the same rights as UK pensioners, as do those retiring to Switzerland.

However, it is important to note that, at present, Britain freezes the state pension payable to retired people in some countries, including Australia, Canada and South Africa, from the date they move overseas, or the date they start to claim the pension if they are already living abroad. This means that they are not eligible for annual increases.

The UK has social security arrangements with several overseas countries, among them Cyprus, Malta and the USA, which protect pension rights. The rules are complicated and vary between countries, so, as always, do your homework.

Inheritance tax will be an important consideration for many retired people. Regulations vary from country to country, so it is vital to take the appropriate professional advice before committing yourself to a move.

Healthcare and medical treatment

The availability and quality of healthcare and medical treatment vary widely between countries, and sometimes even within the same country. It is important to consider this when planning to emigrate, particularly if you have a chronic medical condition or are at a stage of life when healthcare becomes more of an issue – for instance, if you are planning a family, have young children, or are of retirement age.

Some countries, including Canada and Spain, but famously not the US, offer state healthcare, but check carefully to ensure your eligibility. For example, residents of Spain who are not pensioners, employed or officially resident do not have access to state health services.

Where a national health service is available, long waiting lists are common, so you might want to consider private health insurance. Several UK companies provide schemes for people living abroad, some country-specific, others more general.

If you need regular medication, ensure you have adequate supplies to cover you for the period between leaving the UK and signing on with a doctor in your new country.

Property matters

One of your major decisions will be whether to sell your UK home or let it, and whether to rent or buy in your new country.

Many people like the feeling of security offered by keeping a UK base, the idea that they haven’t burned their bridges. Others consider a clean break to be best, or don’t want the hassle of letting.

Before committing yourself to a purchase, it may be wise to rent for a time, to see how your move works out. However, there may be reasons against this, for example if property prices in your destination country are rising rapidly.

Whether you decide to buy or rent, bear in mind that, as in all other areas, regulations differ from country to country. Do not assume that things work in the same way as they do in the UK. In some countries, you may find yourself legally bound at what seems like a very early stage. Never sign any document without being satisfied that you understand all its implications.

It is essential to seek advice from a lawyer who is fluent in both English and the language of the country in which you are purchasing or renting. If you are looking to finance your purchase through a mortgage, you will need specialist advice on this too.

Removals

Moving home is well known to be one of life’s most stressful events, and it is even more so when one is moving country too. To ensure as painless a move as possible, it is well worth starting to research removals companies at an early stage. Choose ones that specialise in international removals, and get at least three quotations.

As well as showing you references and giving you details of the logistics of your proposed move, your removal company should be able to answer the following questions (and any others you may have) to your satisfaction: