The Malta financial Services Authority said in a statement on 20 August that “Blevins Franks Trustees had requested the Malta Financial MFSA to accept the termination of registration of the Expatriate Retirement Plan as a Personal Retirement Scheme in terms of the Retirement Pensions Act, Cap. 514.”

The island financial regulator said it had accepted the company’s request, further stating that the “termination is entirely voluntary and does not arise as a result of any regulatory action taken by the MFSA”.

The plan will no longer be registered with effect from 2 September 2024.

In a statement to International Adviser, Blevins Franks said: “Historically Blevins Franks have had two QROPS plans. The vast majority of QROPS business has only been placed with one of these plans and it made sense, in terms of future cost savings to merge the two plans into one.

“This internal exercise will have no impact on clients (other than the positive one of future cost savings for those merged into the remaining plan) or the future availability of QROPS in Cyprus, France, Malta, Portugal, Spain.”

Blevins Franks also updated International Adviser regarding one of its key providers, Lombard International, which is in the process of being acquired by Utmost Group ,with anticipated completion at the end of 2024.

Blevins Franks said: “In terms of the Utmost-Lombard transaction, we have successfully worked with Utmost and Lombard (as well as other product companies) for many years. We have been very satisfied with the product solutions from the various jurisdictions where they are both based and that each provide, to meet the financial planning needs of our clients.

“At this time, we see the merger of the two companies as having no impact in terms of the territories Blevins Franks operate in, which is in turn governed by our own internal business strategy.”

The wealth manager has hired Stuart Ritchie as managing partner and Mauro De Santis Bo as partner.

Ritchie is part of the GSB leadership team, providing strategic direction to help the business reach its objectives.

De Santis Bo started his career as a lawyer in 2010 with one of the top 3 firms in Argentina, before moving to the UAE in 2013 and embarking on a new journey in the financial services sector.

He now benefits from a decade of experience as a financial planner and specialises in providing comprehensive financial planning solutions for expats around the World.

The firm has also appointed Christopher Wright as senior executive officer, chief executive and head of UAE.

As well as David Smylie as group head of GSB private.

IFGL

The investment solutions provider has appointed Kelvin Revere as IFGL group actuary, appointed actuary for RL360 insurance company and RL360 life insurance company.

Revere brings 25 years’ experience within on-shore and off-shore life companies.

Since joining the group in 2010, he has held the toles of head of actuarial and chief actuary.

Legal & General

The investment service has hired James Shattock as managing director for UK protection and Pippa Keefe succeeds his role as commercial director.

Shattock brings over 25 years’ experience in the insurance industry. He joined Legal & General three years ago from UNUM UK where he was chief underwriting officer.

Keefe, who was previously Legal & General retail protection businesses development director, brings over 13 years’ experience in the protection market.

Brooks Macdonald Group

The investment manager has hired Maarten Slendebroek as chairman and as non-executive director.

Slendebroek was the chief executive of Jupiter for five years from February 2014 and has been the chair of supervisory board of Robeco since August 2020.

Platform One

The investment platform has appointed Matt Freeguard as its director of product.

Freeguard joins from the investment wrap platform and wealth software, Shares, where he was investment products manager.

The Exit Partnership

The business manager has hired financial planner and wealth management professional, Zane Hunter.

Hunter as sat on the board of leadership teams, most recently as head of wealth for One Four Nine group.

Blevins Franks

Martin Gilbert has joined the board of the specialist financial advice firm.

IHT receipts in April to July this year were up £200m ($248m, €232m) from last year at £2.6bn. Fines on families who broke IHT rules jumped by a third to £2.28m last year.

If there is a liability to IHT, this sits with the estate itself and will need to be paid before the net can be paid away to beneficiaries. While the estate passing to the spouse is exempt, the rest would be potentially liable at 40%, less a tax-free amount of £325,000. If any of the £325,000 is unutilised on the first death, there will be up to £650,000 of allowances available on the second.

A further £175,000 of relief is available on the main home if it is passed to children, or £350,000 if this is not utilised on the first death. While overall, there is up to £1m of allowances, the main home relief tapers away for estates worth over £2m, reducing to nil at £2.35m.

The application of UK succession law is based upon the domicile status of the deceased, not where they were tax resident at the time of death.

Domicile is a common law concept, and a person is domiciled in the UK if they belong here and regard it as their home. At the outset, this follows the parents’ (commonly the father’s) domicile at birth (the ‘domicile of origin’). This can be changed by moving somewhere else, making it their permanent home, renouncing the UK as their native land, and adopting a ‘domicile of choice’.

This sounds much easier than it really is in real life. In fact, a UK domicile of origin is very sticky, and can remain in place even if you have been absent from the UK for many decades.

The majority of EU countries have a civil law legal system, where succession law and inheritance taxes are applied on the basis of the deceased’s habitual residence status.

The incompatibility between the two rules could see the estate of a UK national who dies while living in an EU member state an area of cross-border legal conflict, with both the UK and the EU state claiming the asset must pass to their heirs according to their succession law, as well as arguing they have the taxing rights.

The aim of a double tax convention is to allow the country in which the deceased was domiciled to tax all property wherever it is, and for the other country to tax only specified types of property, mainly real estate, in its territory. If double taxation arises, there are rules for deciding which country gives credit for the other’s tax.

For the majority of European countries there is no template to fall back on to establish which country is the deceased’s domicile. As no national succession law automatically takes priority, there is no basis as to who has the taxing rights. If both choose to tax the asset, double tax relief should still be available, but this may be restricted if the asset is located in a third country.

The succession law of each member state varies somewhat, but the majority follow the Napoleonic code to some degree and include provision for ‘protected heirs’. In many cases, children sit in a superior position to the spouse, enabling them to inherit 50% to 75% of the deceased parent’s estate. They may also have the power to remove the surviving spouse from what was the marital home after a fixed period.

In 2015, the EU attempted to try and find a solution with its new European Succession Regulations. Also known as ‘Brussels IV’, the new law covers cross-border inheritances and allows foreign nationals living in the EU to choose whether the succession law of that EU member state or their national succession law should apply on their death.

Brussels IV is not the perfect solution. In some cases it can result in more succession tax becoming due. There also remains several options clients can choose from to protect their spouse, including inserting clauses in the conveyancing of real estate, amending the marital property regime around the ownership of other investments and assets, and looking at certain financial products which may provide flexibility in estate planning, additional allowances or reduced rates of estate tax.

This article was written for International Adviser by Jason Porter, director of specialist expat financial planning firm Blevins Franks.

On 20 June, the Spanish Supreme Court reportedly cancelled the clause of the country’s immigration rulebook that allows migration authorities to remove temporary residence permits from those who spend six months or more outside of Spain within a one-year period.

The change reportedly means that temporary residency can only be removed by force of law, not because of how long you’ve been out of the country.

Jason Porter, business development director at Blevins Franks, said: “This is unlikely to be the final word on this matter; the six-month rule could be reimposed in the future via a higher level of Spanish legislation.

“While the Supreme Court has terminated the requirement of having to spend six months in Spain to validate a temporary residence permit, the same court has confirmed this should be legalised by way of a change in the Immigration Law, a higher level of law than just a Regulation, the form it currently takes.”

The ruling means that anyone who has temporary residence in Spain, which is up to five years, can now leave the country for more than six months in a year if necessary and will not have to worry about losing their permit when they return. After having lived in Spain for five years, non-EU nationals are able to apply for a long-term residency card.

Porter added: “This change could result in a huge amount of confusion for those individuals who after five years have the opportunity to elevate their Spanish residence permit from temporary to permanent. Alongside the six-month rule, there is also the fact the individual cannot be absent for more than 10 months in total in the five-year period prior to the permanent permit application. This rule remains, so with absences of more than six months a year, they can renew a temporary residence permit, but not upgrade it to permanent version.”

British expatriates need to know when their UK tax residency ends and their residency in their new country commences, writes Jason Porter, business development director at Blevins Franks.

Most countries – including the UK – have a 183-day test, where if they spend this number of days or more there, they are regarded as tax resident for the whole tax year.

Some countries also have a centre of vital interest test (where the family, business, main home, etc, is there), where they can be regarded as tax resident even though they may be present for less than 183 days.

Some countries split the tax year and only regard a UK national as tax resident from the date they arrive, dividing the tax year into two. Others may not regard them as tax resident if they cannot complete 183 days in the year, which can offer up tax planning opportunities.

The UK’s own statutory residency test could mean an expatriate is restricted in the number of days they can spend in the UK before they become a tax resident, due to the number of ties or connections they have with the UK. Exceed the number of days they are allowed, and they may be regarded as a tax resident of both countries.

Pensions

As a retiree, a UK national will need to establish how their pension(s) are treated in their new country.

Some will have very attractive tax regimes for pensioners, but they may need advanced planning before they move to benefit. Make sure they know where they stand before they go.

If they intend to take a 25% pension lump sum, they should do this before they leave the UK if they can, as it will be tax-free.

If they take it after they have left, it is likely to be taxable in their new country.

Capital gains timing

It is important to establish where a UK national is resident when they intend to dispose of an investment, asset, or property – particularly the latter, as they may be taxable both where they live and where the property is located – though normally they can set off one liability against the other.

They might be flexible on the date they can sell – before or after the move – timing this to the country where they will pay the least tax. Certain countries will be better for the sale of certain assets, so some homework is needed.

If they are leaving the UK, the simplest tax planning is to sell their old UK main home before they go. If that is not possible, they will need to understand what main home reliefs are available in their new country, as these may not be as favourable as the UK. If they delay the sale too long this could result in a substantial tax charge.

Wealth tax

Many countries have a wealth tax – a tax on the value of real estate (examples are France and Portugal) – or even on most of their capital assets (Spain).

If the value exceeds the exemptions and allowances available, then they may well have some new annual taxes to pay.

It is possible to plan for wealth tax by divesting of real estate and investing in certain financial products, which are aimed at reducing this exposure.

Inheritance/succession tax

UK inheritance tax is not based on place of residence, but on domicile. If a UK national’s parents are from the UK, and they have lived there their whole life, then they are highly likely to be UK domiciled.

This is unlikely to change if they move abroad, so their worldwide estate will continue to be liable to UK inheritance tax.

Other countries may regard them as liable to their succession or estate taxes if they live there, potentially exposing the estate to tax in both jurisdictions. This must be planned for.

They will also be subject to local succession law, which in Europe often means ‘forced heirship’, where they must pass fixed percentages of the estate to their children, sometimes ahead of their spouse. There are things they can done here, but as a minimum they should put in place a local will, as well as revising their UK will to take account of this.

Different countries have different tax regimes

Picking a country will normally come down to personal preference, but some might pick a country based on its tax regime.

Some nations might be attractive to retirees, but not for those in employment. One country might be great for income tax but has particularly high social taxes.

While the saying, ‘Don’t let the tax tail wag the dog…’ has some merit, an attractive country with a just-as-attractive tax regime will always be in high demand – with correspondingly high property prices.

UK tax-efficient investments

Financial products like ISAs and NS&I will not be tax efficient abroad.

An expatriate may want to consider cashing these in before leaving the UK, and look for what might be tax efficient locally.

Visas and residency permits

While not tax, a UK national will have to establish which visa and residency permit they will need and apply for and obtain before they go.

This process should take roughly three months but beware of consular staff shortages and administrative backlogs lengthening this timeframe.

This could affect the move date and tax planning that is time sensitive.

This article was written for International Adviser by Jason Porter, business development director at Blevins Franks.