Thinking of living abroad? Don't forget your finances

A post-pandemic stint in another country (any country!) seems like a great idea. Maybe you want to take a new job for a couple of years, or spend a year studying.

So what do you need to consider from a financial perspective? Well the main things are pensions and tax.


you have several options of how to treat your pension when going abroad:

1) Leave your pension in the UK

Your pension continues to be held by your pension provider until you claim it. You can request early payment of these pensions from age 55.

If you are not able, or do not draw your pension, at age 55 you can claim your pension from your normal pension date.

2) Transfer your UK pensions to the new country

It may be possible to transfer your UK pension if the new pension plan is a "Qualifying Recognised Overseas Pension Scheme (QROPS)".

3) Pay into a UK pension scheme from abroad

Living abroad, or working for an employer who is based overseas, no longer limits the amount either of you can pay into a UK pension scheme. The downside is that tax relief may not be available.

If you end up staying in the new country it is worth remembering that UK pension benefits are typically not paid out of overseas bank accounts so you would need to transfer the money out of a UK bank account

State pension

You may be able to continue contributing to your UK State Pension if you pay into the social security system of a country in the European Economic Area, Switzerland, or a country that has a social security agreement with the UK (this includes the US, Canada, Israel, Turkey, New Zealand).

If you have not managed to contribute to the UK State pension whilst abroad you can catch up when you are back home. It's possible to make voluntary contributions for the past 6 years.


Residency is the big questions around working out how your tax situation will change if you move abroad. In general terms this will be based on: the number of days still spent in the UK; whether you are working full-time abroad; the number of "ties" you have in the UK (a house etc. ).

If you are non-resident in the UK for the time you are abroad then you will only be asked to pay UK tax on any income that you generate in the UK.

If you are UK resident, you pay UK capital gains tax (CGT) wherever the asset is situated in the world. This does not change if you are temporarily non-resident (away for five years or less). However, if you are non-resident for longer than this, then the general principle is that you are not liable to UK CGT even in respect of assets situated in the UK. Although there are some specific rules around residential property.

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