Home » Expat Focus Financial Update 01 March 2017

Expat Focus Financial Update 01 March 2017

Plans for EU expats in UK

Another week brings more confusion for EU expats working in the UK with one national newspaper saying a new multi-year visa will be brought in after Brexit.

More worryingly, the cut-off date for EU migrants to be considered under any future agreement about their rights within the UK could be just a few weeks away while the EU wants the cut-off date to take place after the Brexit process is invoked.This date is important since it will be the date for restricting who can remain in the UK without a visa.

The Sunday Times says the British government is looking to take full control over immigration and will issue five year working visas for various sectors and those coming from the European Union will be barred from claiming benefits during their stay.

Apparently, the sectors being considered for visas include farming, social care and health, hospitality and software engineering, which have big demands for migrant workers.

The newspaper also reports that the British government is still keen to guarantee rights for EU expats who are living in the UK when Article 50 is triggered – on the condition that British expats in Europe also get a similar agreement.

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After the news report was published, the government denied it would restrict benefits for EU citizens moving to the UK.

However, it also appears that net migration to the UK is falling.

According to the government’s figures, in the year leading up to September 2016, the numbers of arrivals in the UK fell by 49,000 for net migration to be 273,000, with Polish nationals increasingly opting to return home.

The figures also show that there are record numbers of Bulgarians and Romanians heading to the UK.

The Office for National Statistics says the figures have dropped below 300,000 for the first time in two years.

Germany is top for expat work

A survey has revealed that the most attractive country in the world for European expats is Germany with 74% of the continent’s workforce saying they are willing to pursue opportunities overseas.

The next most popular countries are the UK, France and Switzerland, according to employees working in Europe.

Of those countries where people are more keen to work overseas, Italy tops the list with 88% of its workforce likely to consider overseas job opportunities with Germany their number one destination.

The survey of 10,000 workers also reveals that 86% of Poles would consider working abroad as would 85% of workers in Spain.

Around 21% of European employees say they would consider a move to Germany to pursue career opportunities though the figure rises to 35% for those in Spain, 33% for workers in Poland and 31% of people in Italy.

The workforces in the UK and France are the ones least likely to undertake a move overseas, with nearly half of employees saying they are not interested in doing so and that having to speak a foreign language is a big influence on this decision.

The survey by HR firm ADP also reveals that increasingly popular career choices for Europeans are freelancers and those in self-employment, particularly in tech industries.

The top 10 of most popular countries for European expats are made up of Austria, Belgium, Spain, Norway, the Netherlands and Italy, while North America ranked in 12th spot.

Expat millionaire destinations

Expat millionaires are increasingly heading to Australia which is now beating traditional destinations including the UK and US.

The findings come from a survey carried out by New World Wealth, a wealth of research firm, which says that in 2016, nearly 11,000 millionaires made Australia their home.

That is a rise from the 8,000 millionaires who moved there in 2015 which also placed Australia in top spot that year too.

In comparison, 10,000 millionaires headed to the US last year and 3,000 to the UK.

Other countries that saw a big inflow of millionaires last year include Canada, the UAE, New Zealand and Israel.

However, the countries that lost the largest number of millionaires were France, Turkey and Brazil.

Among the reasons given for millionaire expats heading to Australia included access to an investment visa where the application was fast-tracked – even when the expat failed to meet immigration criteria – and high economic growth being enjoyed in the country.

Expats there also say Australia is sunny and safe for millionaire expats and it’s a country where they can easily set up in business and trade easily with other countries.

Best countries for expats buying a home

For those expats looking to buy property when they move overseas, a new survey has revealed which countries will offer the best value for money.

According to relocation firm MoveHub, the best country for first-time buyers is the United Arab Emirates.

The firm says it looked at data for 33 countries last year and compared average salary increases to calculate which nation offers an expat the easiest route to take their first steps onto the property ladder.

The report also reveals that those countries with the largest property price increases had also seen the lowest growth in annual incomes, and some countries saw salaries decline while house prices grew.

In top spot is the UAE where salaries went up last year but the value of property fell by nearly 8%. Singapore also offered good home buying opportunities since prices there fell by 3.4% while salaries grew by 3.7%.

French expats urged to leave London

When presidential candidate Emmanuel Macron visited London to meet with Prime Minister Theresa May he also held a meeting of nearly 3,000 French expats and told them that they should consider moving back to France to be entrepreneurs.

He also insisted that they could teach others how to succeed in business, particularly for those in the finance and business worlds, and he wanted to bring their experience in innovation back as well.

With around 300,000 French expats currently living in London, the city is seen as a major destination for potential presidential candidates to drum up support for their policies.

Mr Macron also told the British Prime Minister that he would like to see French expats returning home, including academics and researchers.

Meanwhile, Indonesia’s President Joko Widodo has urged his fellow countrymen to return home from Australia during a visit there.

He told one audience in Sydney that he wanted Indonesian expats to return and use their experiences to start businesses in their home country – and he promised to build infrastructure to help them.

New Zealand bids to attract tech expats

New Zealand has unveiled an initiative called LookSee Wellington which is aiming to recruit 100 technology expats from around the world with a range of well paid jobs.

The main focus is on attracting talent from the United States and the initiative will arrange meetings between prospective employers and a potential expat recruit who will have their flights and accommodation paid for.

Among the attractions being cited for potential expats to move to the country are a good standard of living, free health care for those who hold a work visa that is valid for two years or more and an excellent environment for innovation to encourage new businesses.

The move follows a surge in visits from US citizens after the presidential election result was announced to the Immigration New Zealand website.

That’s when more than 56,000 extra visits were recorded in the 24 hours afterwards as growing numbers of Americans looked overseas for work and living opportunities.

The selected candidates will be flown to the country in May for prearranged interviews and they will be shown the experience of living in Wellington.

South Africa introduces new tax bracket

Expats working in South Africa will be subject to a new 45% tax bracket being introduced to help boost the government’s coffers.

The new rate will apply to anyone earning more than 1.5 million Rand (£93,152/$115,600).

The government says the move will affect around 100,000 taxpayers who previously may have paid the 41% top bracket rate for those earning more than 701,000 Rand.

The new tax rate should, according to the country’s finance minister, generate an additional R16.5 billion.

In other financial news…

New Zealand’s government has unveiled plans to clamp down on employers who dodge immigration laws to employ expats directly. The new rules come into effect from 1 April and those found in breach of employment and immigration laws will be prevented from offering jobs to overseas workers in future.

A new database which claims it will tackle Brexit ‘misinformation’ to enable expats around the EU to access accurate information has been unveiled by University of Cambridge researchers. The aim is to keep expats from making a ‘rash Brexit-induced decision’.

Expat business leaders in France have raised issues with the policies being presented by the National Front in their presidential campaign which include employers being taxed an additional 10% on the salary for any non-French employee and a ban on anyone holding dual nationality with another European country. One Franco-British chamber of commerce said that employers would still need to take on non-French workers if they had a ‘real need to do so’.

A record number of expat Dutch nationals have signed up to take part in the next parliamentary elections with more than 77,500 doing so for the March 15 vote. That’s a much higher figure than 2012’s turnout of 50,000 Dutch expats.

British expats living in the Turks and Caicos Islands can now access a buy to let mortgage range for UK property from Skipton International. The lender also says that expats in Hong Kong have generated a 250% increase in buy to let mortgage applications this year – compared with a 46% increase in applicants from the rest of the world.

Saudi Arabia has revealed it is planning to link up the data from expats’ work and residence information systems. The government says the aim is to enhance policies and laws affecting expats in the kingdom.

Business travellers are increasingly returning to Russia, with demand for business visas rocketing by 58% in the past year. The travellers, mainly from Britain, the US and Germany, are heading to Moscow and St Petersburg which are also increasingly attractive as locations for business forums because of the country’s depreciated currency.

Legal experts in Qatar say that should an expat reveal an employer’s trade secrets then they can be fired without any right to their end of service benefits. The new law also states that job contracts should include a provision that prevents an employee working for another employer for up to two years to avoid conflict of interest.

A firm of mortgage brokers that helps British expats and overseas buyers find UK property says they are being routinely rejected for mortgages by lenders in the UK. They say that the borrowers are struggling to find finance because they don’t receive the correct advice. This is partly down to the tougher lending requirements that have been brought in for the UK’s buy to let lenders.

Small and medium sized enterprises in the Gulf Co-operation Council region have been urged to consider flexible benefits for their expat staff. With growing numbers of employers looking to reduce their costs for health cover, they are being urged to offer other benefits to help attract talent. The call comes from leading HR firms who say that an expat’s needs change as they get older so employers could be offering their younger expat employees a different package to the one offered to older expat employees and point to the provision of healthcare being less important for younger people but who may appreciate transport or subsistence subsidies instead.