--- title: Insights | Retirement planning | Retiring abroad description: What happens to your pension and benefits if you move abroad for retirement? What about the tax you pay? We answer some key questions about retiring abroad image: https://www.puntersouthall.com/hubfs/Banners%20and%20images/Woman%20floating%20in%20a%20swimming%20pool%20on%20holiday.jpg --- - [ Our services ](https://www.puntersouthall.com/our-services) - [ Pensions ](https://www.puntersouthall.com/pensions) - [ Defined benefit ](https://www.puntersouthall.com/defined-benefits) - [ Defined contribution ](https://www.puntersouthall.com/pensions#defined-contribution) - [ SIPP & SSAS ](https://www.puntersouthall.com/pensions#self-invested-pensions) - [ Expert witness ](https://www.puntersouthall.com/expert-witness) - [ Analytics ](https://www.puntersouthall.com/analytics) - [ Numbers for lawyers ](https://www.puntersouthall.com/analytics#numbers-for-lawyers) - [ Data compliance ](https://www.puntersouthall.com/analytics#data-compliance-for-data-confidence) - [ Legal ](https://puntersouthall.law/) - [ Employee benefits ](https://www.puntersouthall.com/service-update-apr-24) - [ Financial planning ](https://www.puntersouthall.com/service-update-apr-24) - [ Insights ](https://www.puntersouthall.com/insights) - [ Blogs ](https://www.puntersouthall.com/insights) - [ Our story ](https://www.puntersouthall.com/our-story) - [ People & culture ](https://www.puntersouthall.com/people-culture) - [ Our people ](https://www.puntersouthall.com/staff-directory) - [ Awards ](https://www.puntersouthall.com/awards) - [ Careers ](https://www.puntersouthall.com/careers) - [ Contact us ](https://www.puntersouthall.com/contact) [![Punter Southall - Animated icon](https://www.puntersouthall.com/hubfs/raw_assets/public/punter-southall-hc/library/images/client/logos/punter_southall_anim_logo.gif) ![Punter Southall - Text logo](https://www.puntersouthall.com/hubfs/raw_assets/public/punter-southall-hc/library/images/client/logos/punter_southall_text_logo.svg) ](https://www.puntersouthall.com/) ** ** ** - [ Our services ** ](https://www.puntersouthall.com/our-services) - [ Pensions ** ](https://www.puntersouthall.com/pensions) - [ Defined benefit ](https://www.puntersouthall.com/defined-benefits) - [ Defined contribution ](https://www.puntersouthall.com/pensions#defined-contribution) - [ SIPP & SSAS ](https://www.puntersouthall.com/pensions#self-invested-pensions) - [ Expert witness ](https://www.puntersouthall.com/expert-witness) - [ Analytics ** ](https://www.puntersouthall.com/analytics) - [ Numbers for lawyers ](https://www.puntersouthall.com/analytics#numbers-for-lawyers) - [ Data compliance ](https://www.puntersouthall.com/analytics#data-compliance-for-data-confidence) - [ Legal ** ](https://puntersouthall.law/) - [ Employee benefits ** ](https://www.puntersouthall.com/service-update-apr-24) - [ Financial planning ](https://www.puntersouthall.com/service-update-apr-24) - [ Insights ** ](https://www.puntersouthall.com/insights) - [ Blogs ** ](https://www.puntersouthall.com/insights) - [ Our story ](https://www.puntersouthall.com/our-story) - [ People & culture ** ](https://www.puntersouthall.com/people-culture) - [ Our people ** ](https://www.puntersouthall.com/staff-directory) - [ Awards ** ](https://www.puntersouthall.com/awards) - [ Careers ** ](https://www.puntersouthall.com/careers) - [ Contact us ](https://www.puntersouthall.com/contact) - ** ** Savings and lifestyle Financial planning 30 September 2021 [** Back ](https://www.puntersouthall.com/insights/) **Author:** Bryan Parkinson # Retiring abroad? Tips to consider How to plan your retirement abroad ## Living abroad after retirement ​​​Have you ever dreamed of living your “after work” years in another country - possibly one with a lower cost of living, better climate and great food? Many people dream of retiring abroad, but face several key questions they need answers to before doing so – one of the most significant of these being “how will my finances work?” In this article, we explore the financial planning implications of an expat retirement. ### Using pensions abroad When you retire in the UK you can expect to receive a state pension (from your state pension age) and income from workplace and personal pensions that you have accrued over a career. These will likely be handed to you in GBP. When living overseas, however, you not only must ensure that you can access your [pension](https://www.puntersouthall.com/services/pension-planning) benefits from there - you need to be able to convert these into the local currency. The good news is that you can claim the new State Pension in most other countries. However, you will not receive a yearly increase under the “triple lock” system unless you live in the EEA (European Economic Area). This exception is not guaranteed over the long term, however. So you need to factor this possibility into your long-term [financial plan](https://www.puntersouthall.com/creating-a-strong-financial-plan). The value of financial advice is evident when it comes to the complex area of pensions. With your workplace and private pension(s), you will likely need to [seek financial advice](https://www.puntersouthall.com/services/financial-planning) about how best to manage these when moving abroad. In some cases, you can “take your pension with you” by transferring it to a QROPS (qualified overseas pension scheme). However, quite often it will be necessary to keep your pension(s) in the UK and transfer money overseas to your local bank account - incurring fees (e.g. currency exchange) in the process. #### Paying tax abroad For those retiring in the UK, most of a person’s retirement income will be subject to income tax rates (after your £12,570 tax-free allowance is used up). If you live in another country, however, then you also need to consider how you are impacted by local tax laws. Could any of your [pension income](https://www.puntersouthall.com/the-complete-guide-to-a-pension-plan) be subject to both UK and local taxes - resulting in “double taxation”? In many cases, this can be avoided by living in a country where the UK has a relevant tax treaty. A qualified tax adviser can help you determine whether this is the case, and how the intricacies work. There is a common misconception that you can avoid [inheritance tax](https://www.puntersouthall.com/guide-to-inheritance-tax) (IHT) by moving overseas. However, this is untrue. In fact, the assets you leave to your beneficiaries may become liable to IHT in both the UK and your country of residence when you die. The laws work differently in each country, but generally IHT applies on the value of your estate over a certain threshold (e.g. £325,000 here in the UK). In France, for instance, transfers between spouses and civil partners are not liable to IHT. Yet in Spain, on the other hand, partners and spouses must pay IHT - but 95% of the value of the family home is exempt under certain conditions. New Zealand and Australia do not charge IHT at all. For the UK’s tax laws, your “domicile” will matter hugely. If you are deemed “domiciled” in the UK when you die then your entire worldwide estate will be subject to IHT in the UK. If you are “non-domiciled” then only your UK-based assets are taxed, but this status is difficult to achieve (and not always desirable). ##### Health and housing in retirement For most people, health problems will become more pressing and complicated in older age. You must, therefore, factor the local infrastructure and costs into your decision to retire abroad. Most countries will not offer universal healthcare (free at the point of use) like UK residents have with the NHS. Lots of countries will offer a basic level of state-provided care, with the option to go to private hospitals. The latter should offer better facilities, staff and resources to patients, but likely come at a higher cost. Your retirement plan should factor in the cost here - in particular, whether insurance is available and how much this expense is likely to be. Shelter will also be key: can you buy a property in your desired country of residence? If so, what are your rights of ownership and what are the likely costs? Bear local laws closely in mind. [In Vietnam](https://www.globalpropertyguide.com/Asia/Vietnam/Buying-Guide), for instance, foreigners can buy “dwelling houses” but cannot purchase the land on which these are built. If you are currently a UK homeowner, do you plan on retaining your property (perhaps renting it out) or selling it as part of your moving plans? If you ever need to sell your overseas property, how easy will it be to achieve this quickly? What if it all goes wrong? Even the best-laid plans can go awry. When retiring overseas, it is crucial to have contingency plans ready in case you ever need to move home (e.g. to care for a terminally-ill relative). This may affect your decision about moving your pension(s) overseas. Perhaps you might want to keep most/all of your income-generating assets in the UK, unless you have a strong safety net in your new country (e.g. lots of relatives living locally, who could take you in). It’s also important to recognise the possibility of needing to enter care in retirement. Here in the UK, the average stay in a care home is about [19 months](https://eprints.lse.ac.uk/33895/1/dp2769.pdf) and at least [838,530 adults](https://www.kingsfund.org.uk/audio-video/key-facts-figures-adult-social-care) receive publicly funded long-term social care. If you find yourself needing care when retired overseas, what is the quality and cost likely to be? Each country’s care sector will differ depending on its politics, economy and a host of other factors. Might you need to move home to get the care you need? If there is a chance you might, make sure you have not completely cut yourself off from the UK, financially speaking. 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