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By Michael Doherty
For many UK expats the worst thing about Brexit is the uncertainty.
They don’t know when Britain will leave the European Union or the terms of its departure and so have little or no idea what their own status will be if they want to continue living in an EU country.
But if Cyprus is your country of choice, life has just got easier, for the Interior Ministry has published a guide to the rights of British citizens after their country takes its leave.
Britons who have been continuously resident for five years in Cyprus will be granted residency rights. That will apply to all British nationals and their family members who have lived in Cyprus for at least five years on December 31, 2020, the last envisaged date for the UK’s departure.
In effect, this privilege is being extended to any British families who arrive before the 2020 deadline. They will be allowed to stay until they have reached the crucial five-year threshold, when they can apply for permanent residence.
And so, in the words of this guide, “UK citizens will be able to continue their lives in Cyprus, with the same access to work, study, benefits and public services that they enjoy now, subject to the specific provisions provided for in the Withdrawal Agreement.”
To make sure you benefit from these provisions you need to have a residency card or a certificate of residence. You can apply for these permits from the Civil Registration and Migration Department and, if you haven’t got one, you should do so now.
Publication of this guide does not, of itself, eliminate Brexit problems for UK ex-pats in in Cyprus. They may still face a string of difficulties, on matters ranging from driving licences to money transfers, car insurance to phone roaming charges. It all depends on the terms of the Withdrawal Agreement and the difficulties will be much greater should Britain crash out without an agreement at all.
But the guide rules do at least make it clear that Britons who wish to stay in Cyprus, or move to Cyprus, can do so. They will be able to buy or rent property here, receive pensions here, transfer money to invest in Cyprus and benefit from investments made elsewhere.
There are tax benefits to living in Cyprus. While Cyprus tax residents are liable to income tax on their worldwide income, the first €19,500 is tax free. They can choose whether their foreign pension income is taxed at income tax rates or a flat 5% rate (with the first €3,420 tax-free).
All UK-source pension income is currently only taxable in Cyprus and not subject to UK tax, whereas, with most other countries, government service pensions remain taxable in the UK. There is also no inheritance tax in Cyprus.
But I would strongly advise all expats and would-be expats, whether they are planning to come to Cyprus or stay in Cyprus, to take advice. This is not a step you should take without first weighing all the options.
Woodbrook Group can help you understand your options, how to address your income needs in retirement and how much wealth you will need to support it.
Woodbrook Group is an international firm of financial advisers. Unlike many financial advisory companies, it is not owned by any financial institution or life insurance group, and so can offer you unbiased and impartial advice.
It offers specific services for those seeking to retire abroad. Its experienced consultants can help you balance your savings and investments, by setting up a strategic plan which meets your specific needs in liquidity, risk attitude and return rate expectation. They will keep you informed about specific new opportunities for investment that may be of particular interest to you.
Michael Doherty is CEO of the Woodbrook Group
*For more information, contact our team at the Woodbrook Group Office in Limassol: Berengaria 25, 25 Spyrou Araouzou, 6th Floor, 3036 Limassol, Cyprus.
Telephone: +357 25272820
Website: woodbrookgroup.com
Email: [email protected]
