The Brexit deal saw many British pensioners leaving popular European destinations like Cyprus and Spain as fears and uncertainties prevailed about life in the EU as a UK national.The total number of British retirees in the EU dropped from 474 721 before the Brexit vote to 463 774 in the last year as the Withdrawal Agreement was finalised. Cyprus, in particular, saw a 9% decrease in numbers while Italy experienced a 10% decrease.These numbers are expected to drop even further in the future as more UK retirees will no longer be able to automatically relocate to EU countries to retire.
Many British pensioners decided to pack up and return to the UK to prevent any further potential complications to their retirement plans. They saw the "writing on the wall" of increased cost of living expenses post-Brexit in EU countries - elevated costs that they didn't factor in when they ventured into the EU looking for a warmer and economical retirement.
British pensioners must apply for a residency card in France
UK pensioners who chose to retire in France prior to the 1st January 2021 deadline are protected by the Brexit Withdrawal Agreement and their rights as French residents are protected.
- However, to protect these rights, UK pensioners must apply for a French residency card by the 1st July 2021.
- Those living in France longer than five years and have permanent residency will not have any minimum requirements to meet. Those UK pensioners living in France for less than five years will have to show proof of having sufficient funds/assets in order to qualify.
- British pensioners will continue to enjoy uprating (an annual increase in UK state pensions) and pension aggregation (British pensioners who have been employed in various EU countries and contributed to the different social security programs will have these taken into account when their state pension is calculated). However, bear in mind that the UK may choose at any time to discontinue this arrangement.
- These retired residents of France will still be able to transfer their UK private pension funds tax-free to a Qualifying Recognised Overseas Pension Scheme (QROPS) of their choice but a transfer charge may be applicable post-Brexit.
- Healthcare coverage for UK pensioners in France will not change post-Brexit for those covered by the UK and will continue as is for the foreseeable future. Newer UK retirees will have to apply for healthcare cover from the UK pension fund.
- Procedures for retiring in France for British citizens after Brexit are a bit more involved but not entirely impossible. This can be achieved by applying for a Long-stay Visa Serving as a Residency Permit and each application is processed individually. The most important factor when applying for this type of visa is having sufficient funds or assets (like a mortgage-free UK or French property) and having adequate healthcare cover.
British pensioners living in Cyprus
For Cyprus, with its large population of British retirees, the arrangements are similar to France according to the Withdrawal Agreement.
- This includes continuing to enjoy the rights of residence, work, study and freedom of movement provided they were living in the Republic of Cyprus prior to 1st January 2021, subject to some specific limitations.
- There is no need (only optional) to apply for new residence status if UK nationals already have residency documents like a Certificate of Registration (MEU1), Residence Card (MEU2) or a Certificate or Card of Permanent Residence (MEU3), unlike certain other countries in the EU.
- If UK nationals choose to apply for new residence status (there is no deadline for submission), they have to follow a relatively simple process which requires only a valid passport as proof of identity and current documents that prove current residence in Cyprus. They are then required to go in person to a local Immigration Office or the Civil Registry Migration Department to submit biometric information.
- If residency in Cyprus was issued after 31st December 2020, and UK nationals wish to continue living in Cyprus they can enter with passports at border control for a 90-day period only.
General post- Brexit rule for other countries in the EU
- State pensions can be paid into any international bank account in the currency of the country you're residing in. But this means that payments into your bank account will fluctuate according to the exchange rate.
- Any increase in the state pension payment in the UK will also translate to an increase for expat pensioners.
The UK state pension increases annually in line with the triple lock (introduced in 2010 to ensure that the pension would not lose value), which means that it increases by whichever is the greatest of inflation, average earnings and 2.5%. Any state pension payment made outside the UK will also increase accordingly. All UK nationals eligible for state pension will continue to receive it if they have been living in the EU, EEA or Switzerland before the end of 2020. This is protected by the Withdrawal Agreement.
- If you've moved after this period, any benefits you're eligible for will be dependent on the agreements made with the EU thereafter.
The UK may not necessarily increase pensions if the UK pensioners reside in EU countries that have no agreement with the UK (except for Ireland, Gibraltar and Switzerland because there are already agreements in place with these particular countries).
What British pensioners have to do if their bank account has been closed following Brexit
If you're receiving your pension payments into your UK bank account and have been advised that this account will be closing, you should:
- Check with your pension provider if your pension payment can be made into an non-UK bank account.
- It may be possible to open a UK bank account that operates overseas and in the country you reside in. Your pension payment can be paid into this account for your direct access.
- Your pension provider may be able to make a cheque payment which can be sent to you in the country you reside in.
The retirement dream for UK pensioners in the sunnier parts of post-Brexit Europe is no longer fanciful, as anticipated. Once you choose a possible destination, do your homework thoroughly (but also remember that regulations may change going forward for some countries in the EU) to check that you can fulfil all requirements of your host country and still have access to your money and have adequate healthcare.
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