UK Expats ‘Can Claim’ From Car Finance Scandal
If you arranged a car loan in the UK and then moved abroad, you may be able to claim compensation of up to £700 under a new ruling. The UK’s Financial Conduct Authority has found that some car finance deals were mis-sold between 2007 and 2024, an outcome that could affect millions of people. In this instance, “mis-selling” means that customers were charged higher interest rates so that dealers could gain a bigger commission.
If you bought a car on Hire Purchase (HP) or Personal Contract Purchase (PCP) between 2007 and 2024 in the UK, you may be eligible for compensation, even if you now live abroad. Compensation will be calculated at 17% of the total interest you paid. For example, if you paid £1,000 in interest, you could claim around £170. In cases of extremely high commissions, you could receive all of the interest back, although this likely applies to only around 13,000 customers – still a sizable number.
A key part of the ruling is that it’s irrelevant where you live now: if you bought your vehicle in the UK, the ruling applies. Your lender should contact you, but to be certain, it’s recommended that you complain directly to the lender. Martin Lewis of MoneySavingExpert has supplied a template.
Italy Intends to Raise Flat Tax
Italy’s draft budget for 2026 suggests that financial authorities intend to raise the tax paid by incoming wealthy foreigners from €200,000 to €300,000. Meloni’s administration has already recently raised the tax, but this does not appear to have deterred wealthy expats from relocating. Consultants Henley & Partners report that Italy is the third most popular country in Europe for wealthy expats, particularly since the UK has revised its non-dom regulation.
Dubai: Expats Cash In UK Pensions
Tony Smith, tax expert at St James’s Place (SJP) Wealth Management, told the press this month that expats are cashing in their pensions ahead of inheritance tax changes.
“The Budget change has prompted some expats to consider realising UK pension assets, as removing funds from the UK will reduce their UK IHT exposure immediately. This strategy is particularly attractive for clients resident in a jurisdiction with an advantageous double taxation treaty, such as the UAE.”
He added that his company has seen many clients accessing their UK pension funds from the UAE, not just to benefit from an IHT reduction, but also because there is no UK income tax liability.
“More widely, the UAE is an attractive location for all tax purposes and we are seeing that reflected in the number of people from the UK choosing to relocate here.”
However, if you are resident in regions such as Singapore or Hong Kong, this is not such a viable option, as you will still be subject to paying UK income tax in some circumstances.
Expats Move Funds Ahead of the Budget
It isn’t just inheritance tax that is concerning expats.
Devere Group investment director James Green recently told the press:
“Expats are already weighing their options. Even the possibility of new or extended taxes on pensions is enough to set serious savers in motion. British nationals living in Europe, those planning to retire there, or other nationalities, such as Irish and Dutch with UK pensions, are now considering international solutions to protect their retirement income.”
Green says his company has seen a significant rise in enquiries, particularly from clients exploring the possibility of cross-border EU IORP structures, especially in Malta. These customers, he notes, are not necessarily high-end: middle-class pensioners risk being drawn into higher tax brackets. Pensions are a more appealing target for governments than income tax, and frozen allowances and stealth tax rises have already meant that more people are subject to taxation. If you are resident abroad, he advises, it’s worth exploring options now, before the budget is unveiled.
Spain: EU Housing Commissioner Calls for Regulation of Short-Term Rental Contracts
Dan Jørgensen, European commissioner for energy and housing, told the Catalan News Agency in Brussels that expats can put pressure on local housing markets. He places responsibility on developers and landlords seeking higher profits rather than on expats themselves, and has suggested that some regulation of short-term rents may be appropriate in places like Barcelona. Jørgensen notes:
“Where, of course, it becomes a problem is when these short-term rentals…crowd out ordinary housing. So ordinary people were living in their homes, but now, because of the short-term rentals, they’re no longer able to live there.”
Part of the problem in Spain has arisen because the cap on rents caused landlords to seek bypass solutions, shifting long-term rental contracts to short-term ones ranging from 32 days to 11 months. The EU Commission cannot intervene directly – rental contracts are for individual member states to determine – but it does plan to examine policies aimed at increasing rental stock, particularly in tourist cities.
German Pension Fund Tax
If you work in Germany, you must pay into the state pension fund. The German government is now planning to open a Frühstart Rente (Early Start Pension) fund for all children enrolled in the German school system between the ages of 6 and 17. €10 per month will be paid into each account until the child is 18. This will not be taxed, but nor will it be accessible until retirement age, when it will be taxed in the usual way. The amount should reach around €1,440 over the contribution period, which is anticipated to grow to around €175,000 by retirement — at least on current inflation rates. Growth will also depend on whether the participant chooses to make additional payments after age 18.
At present, it appears that this scheme, due to start in January 2026, will be available to the children of expats as well. As long as your child is enrolled in the German state school system, they should be eligible, as the scheme is not currently nationality dependent.