Expats Archives - Holborn Assets Cyprus

Healthcare guide for expats in Cyprus

Michael Hiden — Wed, 28 Sep 2022 12:48:30 +0000

Health is perhaps the most important thing in life. Gandhi once said that “health is the real wealth.” Living as an expat in Cyprus means that you might experience health problems in a country far away from your country of origin. Comprehensive healthcare coverage would minimise risks and stress, ensuring that all problems would be dealt with efficiently. In this blog, we will scrutinise the options of the healthcare system in Cyprus and what expats should do to have the coverage they need.

Is there a public healthcare system in Cyprus?

The answer is, of course, yes, just like in every EU country. There is a public healthcare system similar to the NHS in the UK. In Cyprus, it is called GESY (or GHS), which is the acronym for the national healthcare system. GESY was launched in 2019, after almost 17 years of negotiations in the Cypriot parliament.

According to the GESY website, it is a modern, patient-centric healthcare system with the aim of delivering quality healthcare services to beneficiaries.

Who can enrol in the GESY?

There are several categories of GESY beneficiaries. Below you can see the list:

Citizens of the Republic of Cyprus and their dependants
EU citizens and their dependants
Non-EU citizens who have a permanent residence permit in the areas controlled by the Republic of Cyprus or have the right to equal treatment in the social insurance sectors and their dependants
Refugees and individuals with the status of supplementary protection

How do I enrol in the GESY?

In order to enrol in the GESY Beneficiary Registry, individuals should be registered in the Civil Registry , or the Registry of the Migration Department and/or the Social Insurance Services. There are two ways to enrol: a) online by using the portal or b) by visiting a personal doctor.

Online enrolment

The first step to access the said portal is to create an account via the Health Insurance Organisation website and activate it. Individuals will then be connected to the Beneficiary Portal and can proceed with the enrolment following the relevant instructions. The enrolment process requires that the interested party fills in specific fields in order to be identified in the abovementioned Registries. Additional information such as an address, phone number etc. will be requested.

Enrolment via personal doctor

If you don’t have access to the internet or you are not feeling comfortable completing the process online, you can visit a personal doctor who will do this for you. During the visit, individuals may also complete their registration on the personal doctor list.

It should be noted that full access to GESY services is given when the beneficiary is registered in the list of a personal doctor of their choice. Beneficiaries hold the right to change their personal doctor two times per year. The list of provided services can be found here.

How much are GESY contributions?

The main GESY source of financing is contributions. The GESY contribution is 2.65% of an employee’s gross salary, with the legislation capping the income to €180,000 per year. Employers contribute 2.90% to the salaries of every person employed by them. Pensioners and various income earners have to pay similar contributions as regular employees. Self-employed people are obliged to contribute 4.0% of their gross income to the GESY every month.

How do detached workers get healthcare in Cyprus?

Some expats work in Cyprus as detached workers. A detached worker (or posted workers as they are commonly known) is an individual, employed or self-employed in the UK, that has been sent to work in a European Economic Area (EEA) country for a brief period of time.

Posted workers can access the Cypriot healthcare system via a GHIC, EHIC or an S-1 form. For more information, it would be best to contact the HMRC’s National Insurance Enquiries’ helpline for non-UK residents.

Who is eligible for an S1 form?

If you are a Cypriot resident receiving a UK State Pension or an exportable benefit from the UK, you may be eligible for state healthcare paid for by the UK.

In addition, if you are a worker on the frontier, you may be eligible to receive an S1 form (someone who works in one country and lives in another).

Can I apply for the S1 form online?

S1 forms can be requested electronically. If you would like to enjoy the benefits of having an S1 form, you can send an email to nhsbsa.ohsregistrations@nhs.net with your request.

In addition, according to the NHS website, you can get an application form for the S1 form provided by the Overseas Healthcare Services.

Registering with the GESY with your S1 form

First, you need to register with the GESY using your S1 form. You can sign up for this either online or through your personal doctor.

A Cypriot medical card will be supplied to you when you register. Because of this, you will be able to get public healthcare with the same low co-payments as Cypriot citizens.

Always bring your health insurance card with you to the doctor.

Private healthcare options

Private healthcare services in Cyprus can be accessed by people who have taken out medical insurance policies. Of course, having medical insurance requires the payment of monthly or annual premiums that could weigh on your budget. If you want to make the right choice, we advise getting in touch with insurance experts such as our team of advisers at Holborn Assets, who are fully qualified to help you.

While Cyprus has an above-average healthcare infrastructure, sometimes patients prefer to travel to Israel, Greece or other EU countries where they could receive better treatment. Some insurance policies cover the expenses, so this is one more factor that you should take into consideration.

Replacing the EHIC with a GHIC

The UK Global Health Insurance Card (GHIC) allows UK citizens and residents to obtain healthcare at a reduced cost or even for free, replacing the European Health Insurance Card (EHIC), which provided the same benefits to UK citizens and residents when the UK was a member of the EU.

UK residents, including non-British nationals, can apply for a GHIC using a form on the NHS website. The form includes data such as full name, address, date of birth, National Insurance or NHS number (CHI number for Scotland and Health and Care number for Northern Ireland). Obtaining a GHIC has zero cost.

What does the GHIC cover in Cyprus?

With the GHIC, you’ll have the same access to Cypriot public healthcare as any other Cypriot citizen. It will pay for things like oxygen and kidney dialysis in addition to emergency care and visits to the emergency room, as well as normal medical care and maternity care.

In case of a medical emergency, you can use your GHIC to receive the necessary medical treatment in the EU. A GHIC doesn’t cover treatment from a private provider. It should be noted that a GHIC cannot be used in Norway, Iceland, Liechtenstein or Switzerland.

Healthcare in Cyprus and Holborn

Health problems and treatments could affect the life quality of an expat in Cyprus. Being prepared for an unfortunate medical situation is the best solution for you. Our team at Holborn Assets is fully qualified to give you the right piece of advice regarding medical insurance and your options in Cyprus.

With two offices in Limassol and Paphos and more than 50 independent financial advisers, Holborn Assets is the financial services provider you would want to have by your side during your life as an expat. Get in touch with us today!

FAQ SECTION

Is there a national healthcare system in Cyprus?

Launched in 2019, GESY (or GSH) is Cyprus’ national healthcare system.

Who can enrol in the GESY (or GSH)?

You should be able to submit an application for coverage if you are a registered citizen of Cyprus, regardless of whether you were born on the island or somewhere else.

Are visits to doctors totally free if I register for GESY?

Once a person has registered with the GHS or GeSY, they are eligible for free healthcare from general practitioners (GPs) and in-patient facilities.

How can I register for GESY/GHS?

There are two ways to enrol: a) online by using the portal or b) by visiting a personal doctor.

The post Healthcare guide for expats in Cyprus appeared first on Holborn Assets Cyprus.

Filing Your Personal Income Tax Return In Cyprus

Michael Hiden — Fri, 17 Sep 2021 11:11:00 +0000

*This blog has been updated on June 22nd 2022

Albert Einstein commenting on his tax returns, said: “This is too difficult for a mathematician. It takes a philosopher.” As the Cyprus tax filing deadline is getting closer, our blog will give you some basic information on what you have to do to get your tax return straight if you live on the island. The Cyprus Tax Department has announced that the deadline for the timely submission of the Income Tax Return is July 31st 2022. According to the Tax Department, the digital Income Tax Return for employees and self-employed/individuals who do not prepare audited financial statements (FormT.D.1) for the year 2021 is now available for submission.

How to apply for a Cypriot tax number

An individual who spends more than 183 days in the Republic is a tax resident of the Republic of Cyprus. If you need to apply for a Cypriot tax number, the process is quite easy.

All you need to do is fill in the form TD2001 given to you by the Cypriot Ministry of Finance. Once the form has been completed, you should submit it to the local district office of the Tax Department accompanied by copies of your passport, a recent utility bill and your permanent registration certificate (yellow slip for EU nationals).

You can either submit the documents yourself by going to the local tax department offices or email the copies to specific email addresses that you can find here. The process is quite simple and usually, it takes 48 hours to get your unique Tax Identification Code (TIC).

TAXISNET Registration

Once you have received your unique TIC number, you can register to the Tax Department’s online portal called TAXISNET. Registering to TAXISNET is an easy and secure process.

To successfully register to TAXISNET, you will be asked for your TIC, your phone number, an email address that you use and a unique registration number which you can find in the TIC document that the Tax Department has sent to you.

We have to note that the user interface may look simple but sometimes it could be difficult to navigate, so we advise you to use the Draft document function before submitting any forms. That’s how you will be able to double-check if any data is wrong, avoiding costly mistakes.

Tax Rates in Cyprus

Tax rates in Cyprus are among the lowest in the European Union. Income and capital gains taxes are low when compared with the rest of the eurozone countries, whilst there is no inheritance tax. View our graph for the personal income tax rates in Cyprus:

For more information on taxation in Cyprus, you can request our comprehensive tax guide by filling in the contact form below.

Expat living in Cyprus? We have the answers

Expats living in Cyprus usually have many questions regarding their finances and how the Cypriot tax system works. While the system is not so complicated when compared with other countries, it is best to have fully qualified and experienced advisers by your side.

Holborn’s advisers have the necessary financial knowledge to assess your financial situation and give you guidance that would help you achieve your goals. Get in touch with us by filling in the contact form below or even come to visit us in one of our offices in Limassol or Paphos.

The post Filing Your Personal Income Tax Return In Cyprus appeared first on Holborn Assets Cyprus.

How to Remortgage as an Expat

user — Tue, 21 May 2019 08:37:49 +0000

Fixed rate, tracker, standard variable – todays mortgage market has more products than ever and finding the right one requires extensive research. Remortgaging is no different, it requires careful consideration.

In a nutshell, remortgaging is where a new mortgage is taken out to either replace your current mortgage or to borrow money that is secured against your property.

As an expat looking to remortgage a UK property there are some things to be aware of.

What are the benefits of remortgaging?

Remortgaging can potentially save you thousands a year. Shopping around for a better deal is something people do with their phone contracts but might not consider when it comes to their mortgage.

Like other lending products, banks usually offer an introductory fixed rate on their mortgages. These are sometimes referred to as headline offers and they can last anywhere from two to five years.

Once the offer has ended your mortgage will usually revert to the lenders standard variable rate. This will more often than not be a higher rate than what you were paying and can increase monthly repayments.

The benefits go beyond savings. Let’s say you have just been offered a job abroad, you might be wondering what happens to your UK property and your current mortgage.

Switching to a buy-to-let mortgage is one option for expats who want to rent out their property while they are overseas for a long period. Remortgaging to a different mortgage type isn’t something to rush into and it’s best to speak to an independent financial advisor before making a decision.

Remortgaging can also give you flexibility. A mortgage that suited your financial situation when you took it out may not be the best fit now. If your salary has increased and you want to up your monthly payments, or even pay off the remainder of the mortgage, you might be restricted.

Some lenders will have an early repayment charge and the ability to increase your monthly payments may be limited. Remortgaging can help you secure a more appropriate deal for your current situation.

What are the drawbacks?

Earning a salary in a currency that isn’t pounds sterling can cause problems with some UK lenders which is why expats may consider an off-shore lender.

One of the main advantages of using an off-shore lender is your salary currency won’t be an issue.

If you do go with a UK lender, be aware that checks are more stringent than they used to be due to changes in the industry. The FCA introduced new rules in 2014 in an attempt to stop people taking out mortgages they couldn’t afford. The mortgage market review (MMR) outcome means that lenders must now ask for proof of income and plans for repayment. This includes a review of not just repayment at the introductory rates but also higher rates.

With these changes there is a chance that you or your partner no longer meets the lenders criteria for remortgaging. Being rejected by too many lenders will ruin your credit score and make borrowing in the future more of a challenge.

The amount left on the mortgage should also be a consideration. Some providers in the UK will not take on a mortgage of £25,000 or less, and if they do the fees may outweigh any savings you would make.

You have decided to remortgage, what’s next?

Switching to a new lender can take up to two months so start early and explore your options.

Some UK lenders will allow you to secure todays rates but start the repayments up to six months later. This allows you to protect yourself against rate increases that may be introduced by the bank in the near future.

Checking your credit rating should be a priority. Money Saving Expert suggests polishing your credit score before approaching lenders to reduce your chance of being turned down. If you are turned down, work on improving your credit score rather than going to another lender only to be rejected again. Remember, too many rejections will have a negative impact on your credit rating.

With a healthy credit score it’s time to sort out your finances. Speaking with an IFA can help you get your finances in order – this is something a lender likes to see when they make a decision.

A final word on rates.

We touched on the potential savings to be had by remortgaging and avoiding hikes in interest rates. Increases to rates set by the bank are different to those influenced by the Bank of England.

If you go with a UK bank then bear in mind that the interest rate set by the Bank of England heavily influences the standard variable rates offered by lenders. For example, if the rates set by the Bank of England have increased during your fixed term, you may want to consider other fixed term options to avoid the variable rates.

Our expert mortgage advisors can help guide you through the potentially tricky process of remortgaging. If you would like some more information specific to your circumstances you can reach us by using the contact form below.

The post How to Remortgage as an Expat appeared first on Holborn Assets Cyprus.

6 Months Until Brexit – Where Are We Now?

user — Tue, 30 Apr 2019 08:08:21 +0000

It’s coming up for 3 years since the first Brexit referendum. The UK has yet to leave the EU and may never do so. Uncertainty continues to prevail. If you are a UK expat, make sure your finances are Brexit-proof (and non-Brexit proof!) by speaking to an IFA.

So when is the UK leaving the EU?

Currently, British MPs have agreed to a 6-month extension of Brexit until 31 st October 2019. The UK may leave the EU sooner than that in the event that agreement is reached between British MPs and the EU. And all sorts of things can happen otherwise…

Can Brexit still be cancelled?

Yes – if the UK parliament says so: “the European Court of Justice ruled on 10 December 2018 that the UK could cancel the Article 50 Brexit process without the permission of the other 27 EU members, and remain a member of the EU on its existing terms, provided the decision followed a “democratic process”, in other words, if Parliament voted for it.” (bbc.co.uk)

Can Brexit be delayed?

Yes, if all EU countries as well as the UK agree.

Could there be another referendum?

Yes, if changes are made to UK law. The Government could do this theoretically. Some academic experts have said that another referendum would take a good five to six months to organise with all the appropriate legal mechanisms in place correctly. The first UK Brexit referendum took place almost 3 years ago now – on 23 rd June 2016. There was less than 4% of the vote in it – with Leave winning by 51.9% over Remain’s 48.1%. That’s very close! No wonder now UK politicians are failing to find a clear way forward. There wasn’t much a consensus to begin with!

How much does UK owe the EU if/when we do leave?

£39bn. That’s the sum which the current withdrawal agreement prescribes. It’s an irony of the Brexit process that Leave voters were promised that leaving the EU would save money for the UK.

Brit Expats in the EU: what happens if the UK leaves with a No Deal?

Widespread disruption to most areas of UK life – but particular worrying times for UK expats living in the EU: “for British citizens in the EU after a no Agreement Brexit, they will become third country nationals and will need to bring themselves within either EU law on third country nationals or national law of the Member State where they are living. Very few of the EU 27 have set out detailed instructions for their authorities on how to deal with British citizens after Brexit in that case.” (Professor E. Guild, Queen Mary University, London)

Brit Expats in the EU: what happens if the UK leaves with a Deal?

Until 31 st December 2020, British expats living in the EU will be able to stay as they are – if the UK Brexits according to the terms of the withdrawal agreement. Expats will need to ensure they are complying with the rules set out by the government of the EU country they are living in. And, after 31 st December 2020, no Brits will enjoy the automatic freedom of movement across other EU countries.

What does Brexit mean for my money?

That’s the big question! As long as Brexit uncertainty continues, the UK Pound Sterling will likely be weak. But, other than that, nobody really knows. Theories and observations bound, particularly in relation to the UK housing market.

How do I Brexit-proof my finances?

Give your financial picture a thorough review with your IFA. If you are a Brit living abroad, you need to be sure that Brexit does not deliver any personal nasty surprises in the area of:  Your status with the HMRC.  Your status with National Insurance Contributions (NICs).  Your UK state pension.  Your private and workplace pensions, some or all of which may still be held in the UK  Your cross-border investment interests, including property and funds.

The post 6 Months Until Brexit – Where Are We Now? appeared first on Holborn Assets Cyprus.

How Will the New Tax Year Affect Your Pension?

user — Mon, 15 Apr 2019 10:24:13 +0000

The new UK tax year began a fortnight ago on 6th April 2019. So how will the new tax year affect your pension? Well it’s good news. If you receive a state pension or pension credits, you will get more. And, if you are auto-enrolled with a work pension in the UK, you and your employee will be making bigger contributions every month to swell your pension pot.

UK State pension – 2.6% increase

As of April 6th 2019, the UK state pension went up by 2.6%. If you receive the new State Pension, you will now receive £168.60 a week. That’s a weekly increase of £4.25. Annually you will be £221 better off. If you receive the Basic State Pension, you will now receive £129.20 a week. That’s a weekly increase of £3.25. Annually you will be £169 better off. Pension credits – for those pensioners on lower incomes – also rose by 2.6% in the new 2019 tax year.

Why has the UK state pension risen by 2.6%?

Every year the UK government is obliged to adjust the payout of the UK state pension. How does it decide what to do? There is a system in place called “the triple lock system”. The triple lock guarantees that the state pension rises – whatever happens! So that’s good news for Brits. Three figures are used to make the calculation: earnings growth, Consumer Price Index (CPI) and 2.5%. Whichever of these three percentages is the highest is applied to the state pension. Until 2019, the UK state pension has risen at the beginning of each new tax year by an average of 3.2% since 2011. April 2011: 4.6% April 2012: 5.2% April 2013: 2.5% April 2014: 2.7% April 2015: 2.5% April 2016: 2.9% April 2017: 2.5% April 2018: 3.0%

UK pension Auto Enrolment – 3% increase

The UK’s automatic enrolment scheme for pensions mean that you and your employer must make a minimum contribution to your workplace pension each month. Together, the two contributions make up a total minimum contribution. And this figure has risen, as of April 6 th 2019, from 5% to 8%. As an employee, the minimum amount you must contribute to your workplace pension went up from 3% to 5%. So that’s a dent on your monthly income of 2%. Not ideal – but it is good news for you in the long-run as your pension pot will swell. (And it’s now the law, so there’s nothing to be done about it). The other good news is that the minimum contribution your employer must make has also risen – from 2% to 3%. These changes are implemented automatically. As an employee, you do not have to take action. (Table from thepensionsregulator.gov.uk) For more information on changes to auto-enrolment in 2019, read this guide for employers from the UK pensions regulator.

How do I get a grip on my pension situation?

Managing pensions can be confusing, especially for expats who must tackle cross-border complexities in regulation. If you are feeling at a bit of loss over where you stand with your pensions, take action! Your eligibility for a UK state pension depends on how many National Insurance Contributions (NICs) you have made. Check your NIC situation online at the UK government NICs website – and use our guide here to navigate the site. Take advantage of the UK Pensions Dashboard when it comes in. There’s over £400m in lost pensions lying around the UK financial system. And, with an average of 11 jobs in a lifetime, Brits often have many pensions to keep track of. So the UK government is putting in place a scheme to provide every Brit with an online pensions app that shows them all their pensions together. (However, in the first rollout of the dashboard, planned for this year, the state pension will not be shown.) Unclear at what age you will receive your UK state pension? Currently, the UK state pension age for both men and women is 65 years old. Use the HMRC’s State Pension Age Calculator to confirm your eligibility. Also note that the state pension age is set to rise over coming years.

Ask an IFA!

It is great that there are more resources online to check your pension yourself. But loads of data does not help much if you do not know how it all fits together. And that’s where your IFA can help. Your IFA can show you how your work and state pensions link up with the rest of your financial picture. Your pensions are the centrepiece of a decent retirement strategy, so it is important to manage them with care.

The post How Will the New Tax Year Affect Your Pension? appeared first on Holborn Assets Cyprus.

How to Make the Most of Tax-Free Earnings

user — Tue, 09 Apr 2019 07:20:16 +0000

Expats have plenty of spending options to enjoy – thanks to their earnings being free of taxation from their country of origin. (Except for US expats, notably.) But expats also generally know that there’s a bit of a trap in play with tax-free income. It goes like this: You leave your country of origin to take advantage of earnings that are not taxed by your home authorities. You end up with far more money than you would have if you had stayed at home. Your idea is to save enough abroad in a shortish spell to retire at home in comfort. But there are many spending temptations abroad. There are travel opportunities, there’s the brilliant weather – there’s a million reasons to put off investing in your family’s financial future. And what’s wrong with enjoying right now? Enjoying the expat lifestyle is all to the good. But it burns through cash. Can you find a way to spend money that will reap financial rewards in the long run? Here are two ideas – education, and property investment. Why not balance your leisure spending on some educational investment instead? And, if not, look at property, particularly in the UK.

You can’t start saving early enough for your kids’ education!

It’s not like most expats need to be told that their children’s education is important. But many expats fail to start saving early enough to tackle the high price of education when it comes around. Over half of UAE parents polled by the HSBC in 2017 said that they wish they had started saving earlier for their children’s education. And failing to start saving early enough means that money has to be begged, borrowed or mortgaged. Give yourself a break, and start looking into how you can start saving – and start making what money you do save start working harder. Get serious with your education planning and speak to an IFA! Parental spending on education in the UAE was the second-highest in the world in 2017 – at just under $100,000 per annum. We don’t hold back. The good news is that, internationally speaking, UAE schools are quite cheap. In Expatfinder’s 2018 analysis, the UAE was ranked 18th most expensive provider of International Schools out of 27 countries. International school fees began to rocket in 2017. Expatfinder’s 2018 survey of almost 700 international schools across almost 30 countries revealed “a startling 19% rise in prices compared to 2017”. When it comes to spending on education as an expat, be assured of one thing: by becoming an expat, you have done your children an enormous favour. You’ve made them into what are known as Third Culture Kids – which means the expat experience as children you are giving them makes them ready for anything as adults. Third Culture Kids enjoy expanded employment opportunities because they are going, as teenagers, into a global work market – and they are already far more globalised than their peers. UAE-based anthropologist Dr Joanna Seraphim says Third Culture Kids “are clearly more open-minded and tolerant because they have seen and experienced things that are different from the people in their own country. For example, a person in the UAE has tried lugemat (fried dumplings) from the UAE, masala chai from India, attended the Chinese New Year festivities and enjoyed Iftar with friends.” You won’t waste a penny giving your kids such advantages through international education.

Property investment opportunities – Britain?

Brexit has got many markets in Britain in shutdown. Nobody wants to spend any money – or risk anything – until the future of Brexit becomes clearer. Read here for an update on a conflicted UK property sector that could go either way. Pay close attention to the UK property sector in 2019. There will be opportunities, whether you are looking to buy-to-let, to settle down or even buying off-plan; speak to a Holborn IFA about your best way to secure a helpful UK mortgage from out in the UAE. Transnational mortgage resolution is bread and butter for the Holborn mortgage team, and will be much easier for you to navigate with experienced hands to deal with the paperwork. Decent off-plan opportunities in the UK are increasingly easier to find. That’s because developers and management companies are wising up to demand from overseas – as well as learning that high levels of support and flexibility for expat clients reap rewards. Off-plan in the UK isn’t the unreliable business that off-plan is held to be in Europe; we’ve all heard the European horror stories. Development and business regulation is high in the UK, and unlikely to slacken off post-Brexit. Of course, the UK is not the only off-plan market currently looking good; off-plan opportunities in the emerging economies of Asia (Vietnam, in particular) are opening up as regulation of foreign investment eases up.

The post How to Make the Most of Tax-Free Earnings appeared first on Holborn Assets Cyprus.

What is Off-plan Property Investment?

user — Thu, 28 Mar 2019 10:20:35 +0000

xOff-plan investment is an exciting and flexible option for private investors that is gaining in respectability worldwide. Both the UAE and the UK offer established sectors where private investors can gain excellent, long-term returns (in exchange for some risk, of course). And, in South Asia (particularly Vietnam), there are emerging markets that offer great opportunities to get in at the bottom right now in 2019.

What is off-plan investment?

Investing off-plan means buying a property before it is actually built – and, when it is built – rather than living in it, the investor will either sell, or hold the property and rent it out. Many off-plan formats exist. But always the priority is to clarify with an independent, qualified professional exactly what risks are involved, even if you are dealing with a respectable developer. In the off-plan investment sector, an IFA by your side works wonders!

What’s a key advantage of off-plan investment?

As the buyer, you choose how much you want to get involved in your investment. Suppose you were planning to buy off-plan with the purpose of eventually renting the property – companies exist which will take care of all management areas of the project, including furnishing the property and organising its letting to tenants. Buying off-plan from an established agency means you can take advantage of their bulk buying, with “property deals being heavily discounted and high yielding.” (sequre.co.uk) You can even get access to discounted solicitor services thanks to agencies pre-negotiating bulk discounts. Be sure to keep your IFA in the loop, whoever you choose to employ: your IFA has your financial interests at heart, unlike other appointed professionals necessarily!

Will I need a deposit to kick off my off-plan investment?

It depends, but certainly one of the big advantages offered by off-plan investment is the down-payment system. You can often pay by payment plan. This means you can pay in regular instalments – rather than have to cough up in one go the 25% deposit, for example, that applies in the UAE to all residential property purchases.

Can I get a mortgage for my off-plan investment?

Yes, you can. In the UAE, for example, Rakbank, Noor Bank and UAB are providers. Lenders view off-plan mortgages as more risky than bricks and mortar mortgages. And this can be reflected in the rate of interest you are charged. But it all depends on which developer is involved and what stage the project is at (the closer to completion, the less expensive the mortgage).

What sort of prices am I looking at for off-plan property?

As with all investments, the amount of risk determines the purchase price. More risk for the buyer = lower price. Off-plan property is cheaper than built property because it is an inherently riskier purchase. As thenational.ae points out, “there is a chance your property may not be built, may be built late or not to the specifications you expect.” On the basis that they have demonstrated success in the past, developers with a good reputation often charge higher prices than less well-known developers.

Can I sell my investment in off-plan property?

Not until it has actually been built. Unless you manage to broker a deal with somebody you know. There is not an established market in off-plan investments for buyers to sell to other buyers; it is an “illiquid asset” ie. not sellable.

Is buying off-plan better than buying bricks and mortar?

The great advantage of buying actual properties as an investment is in the area of “opportunity cost”. For bricks and mortar purchases, there is no problem with opportunity cost. The opportunity cost of an investment is how much your money would have been earning if it had been invested elsewhere. A rule of thumb is say the opportunity cost is 5% per annum – because you might well get this by simply putting your money in a high interest savings account, or ISA. The problem with off-plan investment is that, until your property is actually built, your money is not gaining any interest at all. It is not as if developers pay you interest on your downpayments. With bricks and mortar, of course, you can immediately start making money on your investment – by either renting it or selling it. With off-plan investment, your money can’t be touched for years. The good news about opportunity cost is that you can factor it into your investment equation – just as you would with any other cost. Just make sure your return on the investment is large enough to absorb the opportunity cost. Keep your eyes peeled, and get your IFA on the case too!

The post What is Off-plan Property Investment? appeared first on Holborn Assets Cyprus.

5 Tax Considerations for Expats

user — Tue, 19 Mar 2019 09:07:03 +0000

Looking to become an expat? Holborn Independent Financial Advisors (IFAs) in your new country of residence can help you out. All international Holborn offices offer a no-obligation financial review to new expats.

Financially, there’s so much to get sorted out when becoming an expat. Not only do you need to review all aspects of your big financial picture, which can be overwhelming, but you can’t just do this by simply following a checklist you’ve found online. What you need to do to protect your family’s financial future will depend heavily on your exact circumstances, so you need qualified advice as a priority.

Get in touch with Holborn before you go to get your expat finances right from the beginning.

Key expat priority – tax!

Managing your tax situation is the key priority for new expats. Maybe the very reason you are leaving your home country is to take advantage of lower income tax in your new country of residence. Great! But there’s far more to tax than income tax if you are planning to move abroad. You’re going to have a complex web of cross-border tax obligations – and opportunities!

IFAs working in expat markets excel at getting your international tax situation straight across your pensions, investments (including property), mortgages and estate planning:

Income tax

Whatever your country of origin, you will need to notify your tax authorities that you are leaving. Otherwise, you might end up paying tax on income and/or investments twice – once in your home country, and once in your new country of residence. Tax rules differ from country to country. Find out whether your home country has a Double Taxation Agreement (DTA) with your new country of residence.

Taking in your new cross-border status, you need to know for certain what tax rules apply, how they work together, and how you can make the best of them. A local IFA in your new country of residence can offer reliable support in this key area.

Pensions

Tax is a key consideration in the area of pensions. If you have a state pension (as UK citizens do, for example), you will need to clarify how that works for expats.

But what about your work pension? Expertsforexpats.com point out that, “As an Expat, depending on your plans, you may have unique opportunities available to you and an adviser will be able to discuss each of the options enabling you to make a decision.” As a UK citizen, you can move your pension pot from a workplace Defined Benefit pension into a variety of overseas arrangements and unlock great tax benefits. In the UK as in other countries, managing exposure to inheritance tax can be tackled by prudent reframing of your pension (into a SIPP, for example).

Moving pension schemes is a huge step requiring professional advice, and not one that is not often recommended (that’s certainly what Holborn IFA statistics point to). Transferring your pension might work for your financial situation, or it might not. The only way to find out is to ask an IFA or other pension specialist.

Investments

Any lump sum investments you have will need to be checked for their tax efficiency, as well any property you retain in your country of origin or elsewhere. As an expat, your investment taxation will become more complicated. But you will also enjoy access to opportunities that non-expats do not have. Offshore banking and investment often makes sense for expats; there is an old rule of thumb that says “If your Country of Origin is A, and your new Country of Residence is B, then you should keep your money in Country C.”

Mortgages

Often expats rent when they first arrive in their new country of origin, and take a while to check out the property market. But you can get going sooner if you like. You can arrange a mortgage in your new country of residence remotely via a local mortgage broker. Holborn, for example, offers an experienced mortgage desk at our Dubai HQ that has been successfully arranging mortgages in the complex UAE market for getting on 20 years. Local knowledge counts – so use it as soon as you arrive, or even before leaving!

Estate Planning

Are you planning to retire in your new country of residence? Or like many UK expats, for example, retire back home? You need to decide now what your endgame plan is, and work towards it. Whatever your plan, be sure to get a new Last Will and Testament drafted in your new country of residence. In the UAE, for example, expats can get wills drawn up in international common law with the DIFC Wills & Probate Registry.

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