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Pensions, living and investing in Italy for UK citizens after Brexit

By Daniel Shillito - Topics: BREXIT, Italy, UK Pensions
This article is published on: 4th June 2019

As you well know, a stalemate has developed in the UK and recently claimed the scalp of the Prime Minister. What remains to be seen is whether a new leader can find an alternative solution that has sufficient support and which can create unity within the UK parliament and within the wider UK population.

Despite the EU and the UK government finalising a Withdrawal Agreement and the Political Declaration on a future relationship on 25 November 2018, the UK has not left the EU and the UK parliament together with the government now has until 31 October to finalise and advise their EU exit plans to the European Union.

In the meantime, both the UK and EU have made announcements on their ‘no deal’ preparations.
‘No Deal’ is not an outcome that either side wants, but is something that responsible governments ought to prepare for.

In case you didn’t know, the UK government provides specific information for British citizens living in Italy here.

In Italy last year on 21 December, the Italian government announced that it would be offering UK citizens certain residency rights in the event of no-deal, designed to ensure existing UK nationals in Italy will have the right and necessary time to obtain long-term residency status under EU directive 2003/109.

Here are some related questions and answers provided both by the Italian and UK governments to assist British citizens:

What do I need to do to prepare?
To be assured of the right to stay in the event of a no-deal scenario, it is essential that British citizens are registered at the local anagrafe office of the comune where they reside.

You can read up on the latest news about the Decreto Brexit, and how this bill protects the rights for UK residents in Italy to apply for Italian citizenship, as compiled and summarised by the British in Italy group, at their website, www.britishinitaly.net

How should I deal with my UK private pension?
If you have a personal pension (not state or public service occupational) and have not yet retired, think seriously about cashing it in if you’re old enough (take financial advice on the tax implications of cashing it in before doing so), or transferring it. A detailed pension analysis would be required to look at the suitability of doing so; however it might just be possible to remove your pension from future UK political uncertainty as it affects government regulations around pensions and their tax treatment, especially in a no-deal Brexit scenario.

I’ve thought about getting Italian citizenship, but will it affect by UK citizenship ?
Your UK citizenship is unaffected by any application for Italian citizenship. The UK permits dual-nationality.

What about the UK state pension ?
The UK government will continue to pay the UK state pension to those eligible after the UK leaves the EU.

Do I need to change the way I manage my pension and savings in Italy ?
Did you know that there are some large, household name UK financial institutions that offer products in Europe from countries like Ireland and Luxembourg ?

These products are both EU regulated and tax efficient in Italy.

As a result, should the UK leave the EU, you can still invest with companies whose names you know and trust, in a tax efficient manner, in the country you call home.

The UK leaving the European Union also will not change existing double taxation arrangements for UK nationals living in Italy.

For information and assistance about managing our financial affairs in Italy please contact the author below.

Article by Daniel Shillito

Daniel ShillitoIf you are based in the Milan area you can contact Daniel at: daniel.shillito@spectrum-ifa.com for more information. If you are based in another area within Europe, please complete the form below and we will put a local adviser in touch with you.

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