Worried about Moving to Italy from UK Post-Brexit? Some question and answers.
If you are dreaming of moving to Italy, but are wary of doing so with Brexit looming, should you give up on your dream? We have received a lot of questions on this topic recently.
First and foremost, in the post-Brexit era, assuming that UK nationals who wish to acquire a home in Italy would have no special status, they would enjoy the same treatment and rights as other, “third country”, non-EU nationals such as Canadians, Americans, Australians and New Zealanders who are resident in Italy today.
Some of these, non-EU residents are dependent upon investment or retirement income from abroad. Others work for Italian companies or run their own businesses in Italy. Some are working freelance or earn income from rental properties and other tourist-related businesses.
If you’d like more details about the existing rules regarding such matters as property ownership, visas and health care as they apply to, “third country”, non-EU nationals in Italy, please get in touch with us.
QUESTION: Will I lose my UK pension if I move to Italy?
ANSWER: The British government has indicated that it intends to continue paying and increasing state pensions to expats in the EU after the UK leaves in 2019. In addition, National Insurance (NI) contributions made while abroad will also continue to count towards the state pension. You will receive the full pension, worth £159.55 a week, if you have 35 or more “qualifying” NI years.
QUESTION: As a UK citizen, should I put off moving to Italy until a deal has been agreed with the European Union?
ANSWER: Despite all the uncertainty surrounding Brexit, according to Overseas Property Guides, in the first three quarters of 2018, overall home sales and purchases in Italy rose by 2.3% on 2017. It also appears that UK buyers are still going ahead with their property searches and some have accelerated their plans to move to Italy to beat Brexit. In recent conveyancing transactions we have been involved in with British clients, we have noticed a slight shift in the type of properties people are looking to buy. There’s more of a focus on homes with outbuildings and, as such, income potential to hedge against currency fluctuations and possible economic fall-out post-Brexit.
QUESTION: Will my Italian tax liabilities increase post-Brexit?
ANSWER: If you live in Italy, the same tax rates apply to all residents, regardless of nationality. If you receive income from the UK, tax treatment is determined by the UK/Italy double taxation treaty. The same applies if you are a UK resident and receive income from Italy. Such treaties are cooperation agreements reached between two countries, independently of the EU. Therefore, the UK’s exit from the EU should have no bearing on your future tax treatment. If you are retiring to Italy you may be able to take advantage of Law 145/2018 whereby individuals with an income from a foreign pension or other source abroad, who transfer their tax residence to one of the municipalities with populations not exceeding 20 000 inhabitants in the Regions of Abruzzo, Basilicata, Calabria, Campania, Molise, Puglia, Sardinia and Sicily, can elect to have their foreign income taxed on a flat-rate basis of 7% for each tax period in which the option is valid.
QUESTION: Is buying a house in Italy after Brexit a safe investment?
ANSWER: Irrespective of Brexit, Italy will always be a good place to invest. At this juncture, buying property outside the UK could be a smart choice. It allows you to spread your investment load in another currency, as well as keep capital in a country that is still part of the EU. And if the UK economy struggles in the wake of Brexit, you will have spread your risk and returns. There is, however, no doubt that Brexit is going to create more paperwork for British buyers in Italy. They might also find it harder to get a property loan in Italy or, at least, it may mean paying higher mortgage rates than EU members.
QUESTION: Will British expats have easy access to healthcare in Italy post-Brexit?
ANSWER: It’s fair to say that access to healthcare has been one of the key issues of the Brexit negotiations so far. Nothing has yet been officially agreed going forward. That said, negotiators have agreed, in principle, that UK nationals resident in Italy will continue to see their healthcare paid for by the National Health Service post-Brexit. The agreement will also allow UK nationals resident in Italy to travel to other EU nations and use their European Health Insurance Card, should they require medical attention.