Home » Expat Focus Financial Update February 2024

Expat Focus Financial Update February 2024

New ISA for Expats

Investment and wealth management platform, Novia Global, announced at the end of January that it will be offering a new ISA to expats, particularly Brits in a state of ‘suspended animation’ with their current ISAs who are unable to add any funds to their existing schemes.

The new product will not allow expats to open a new ISA, but it will allow British expats to transfer funds to Novia and have their ISAs managed along with their other financial affairs. HMRC has recently approved Novia as a provider and the new Novia Global Stocks and Shares ISA is aimed at expats who might want to return to Britain and benefit from a tax-compliant product. CEO Steve Andrews says:

“We’re introducing this product in direct response to an issue that advisers and clients have been highlighting for a number of years. We don’t pretend this is a revolutionary solution, but we know it’s one that advisers and their clients want to see.”

Changes for Portugal’s Non-Habitual Residents

Time is running out for expats in Portugal enjoying their current Non-Habitual Resident (NHR) incentives, the financial press reported in early February. Experts warn that NHR holders risk a rise in tax rates of between 28% to 48%, unless they start structuring their assets and income before the scheme runs out. Tax advisors Portugal Pathways say that:

“Many affluent expats are lulled into a false sense of security by the NHR tax regime’s low tax rates. Many fail to realise that these benefits are temporary, and that failing to plan early enough for the future could have serious financial consequences.”

They advise that acting early – within the first seven years of the incentive scheme – can seriously reduce the risk of landing a high tax bill when the scheme expires. They recommend consulting your tax advisor now, in order to see how your portfolio could be maximised to leverage a lower tax bill later on (for example, by looking at capital gains tax exemptions). 

Suffolk Building Society’s Mortgage Scheme for Expats

In early February the Suffolk Building Society announced new products available to both UK residents and expats. Account Manager Andrew Sadler says that the company is responding to a rise in property prices and is accordingly offering a new large loan scheme consisting of two two-year fixed-rate mortgages for loans between £1m and £2m, available for up to 80% loan to value. For expat buyers, the available mortgage is set at 6.09%, which will be fixed until 30 April 2026, after which it will revert to the SVR minus 1.74% until 31st July 2029. Sadler says:

“We have long supported our expat clients and brokers specialising in the expat market. I’m delighted to be able to add another product into this niche area, providing expats with the opportunity to borrow up to £2m.”

The mortgage is aimed at expats working abroad who are paid either in sterling or in other major currencies, such as the Euro, and will allow you to make overpayments that are ERC-free of up to 50% of the balance.

Get Our Best Articles Every Month!

Get our free moving abroad email course AND our top stories in your inbox every month

Unsubscribe any time. We respect your privacy - read our privacy policy.

In addition, Suffolk have cut rates on its five-year expat landlord offers, which it describes as particularly appealing to overseas buyers who want the security of a long-term fixed rate.  It’s now offering a five-year fixed rate at 5.95%, reverting to the standard variable rate for the rest of the term. It’s slashing its two- and five-year fixed rate holiday let mortgage deals as well, taking them down by 0.2% to 6.09% for the two-year product, and 5.79% for the five-year product.

Blow to Second-Home Owners in France

Late January saw a blow to Brits who have second homes in France when the Constitutional Council blocked a move to allow British expats to remain beyond the post-Brexit 90-day period. An automatic granting of long-term visas to second home owners was deemed unconstitutional, and since there is no right of appeal against decisions made by the Constitutional Council, the decree is to be regarded as final. Anyone without right of residence who wants to remain in France for longer than 90 days will need to apply for a temporary long-term visa. It’s a disappointment not only for existing homeowners, but for those who were starting to contemplate relocating in the wake of the proposed amendment – property companies have reported a huge surge in demand since the relaxation of the 90-day rule was first mooted.

However the property experts Blevins Franks commented that:

“The element [to the immigration bill] for UK second home owners was always going to be rejected as it was not treating everyone equally as it does not apply for the other 61 countries eligible for visa entry into France.” 

Expat Favourite Ceases Trading After 20 Years

Expat online favourite British Corner Shop, which stocks British goods for expats feeling homesick for products such as Marmite and Maltesers, along with around 6,000 other familiar items, is going into administration this year after 20 years of trading. It’s the second time that the site has gone into administration, having been sold on to private equity firm Rcapital last year, but this time it looks as though the company cannot be saved. Its owners blame Brexit and Covid, and in spite of serving 700,000 customers, the tough trading climate sounded its death knell. Jonathan Dunn, speaking for the administrators (the specialist business advisory firm FRP) told the press:

 “British Corner Shop faced significant operational challenges over the past few years and, regrettably, was no longer able to meet its financial obligations. Our focus now is on supporting staff with their applications to the redundancy payments service as we wind down the business.”

We know that the service will be greatly missed.