What does Brexit mean for you?
Last month history was made, when 51.8 per cent of the UK public voted for the UK to leave the EU. Following on from the vote there is undoubtedly concerns and uncertainty of what will happen next and how it will affect their circumstances. It’s understandable that people living in Europe, or who have holiday homes in EU countries, could be left feeling nervous about what the vote means for them.
What we do know is that although the majority of the UK voted to leave the EU on 23rd June, it’s likely to be at least two years before we see any changes. Until a deal has been struck between the EU and the UK under Article 50, nothing will change. This might not ease uncertainties though with people worried about what might happen following the two- year deal period or even in between with regards to the economy etc.
According to the United Nations, there are approximately 1.3 million Britons living and working in European countries such as, France, Spain and Ireland. Of those 1.3 million, 300,000 are residing in Spain, and 172,000 in France. It’s likely that the majority of ex-pats that own a home in Europe, will be able to continue to do so, however there may be changes to inheritance and tax to be aware of.
In many countries across Europe, such as Spain and France, British buyers make up a significant portion of the property market. In Spain, for example they account for one in five of all overseas buyers. Brits buying property overseas in Europe is a great boost to local economies, especially in small towns. It would be of great interest for these countries to allow the ex- pats to continue living in their country. For example, many towns in France are reliant on British owners for bringing their pensions to spend in local businesses.
As the biggest group of expats living in EU countries, pensioners could be affected by any currency fluctuations. Post Brexit more of a worry could be whether their state pension will be up-rated annually, according to the BBC. At the moment UK citizens who live in the European Economic Area (EU) have their state pension protected – they are pegged to wage or price inflation.
However, following the vote the UK government will have to decide whether this will continue or whether UK pensions in EU countries should be treated as they are if they retire to say, Canada where their pension is frozen.
With regards to taxes, this situation should remain the same, as there are reportedly bilateral tax agreements between the UK and other European countries that have nothing to do with the EU – and even local taxes should remain the same.
Expats may however need to apply for a visa to live, work or retire to the EU after the two -year period. Overseas residents might become more restricted in terms of these requirements, and unfortunately until a deal is done between the EU and the UK – it is uncertain what these restrictions may be.
Basically it could get more expensive and more complicated to purchase property in Spain or France. Post Brexit, European countries could impose additional or higher taxes on British owners, such as on a house sale. However, its seems unlikely that EU countries would impose anything overly-draconian that would deter British buyers.
With the amount of money that British tourism brings to Europe, and vice versa, with regards to EU people contributing to the economy in the UK, it is likely that EU countries will want freedom of travel to continue. The UK wants to remain part of the Single Market to ensure easy trade, to do this the EU states that we must also continue to allow freedom of movement.
What happens, after Britain exits the EU depends massively on the type of deal the UK strikes with the EU. The BBC reported that following the vote, Spain’s Prime Minister Mariano Rajoy said nothing would change for Britons in Spain while an exit was being negotiated – they would have the same rights they have enjoyed until now as citizens.
Hopefully by the end of this year, the UK government will have declared article 50, and a deal with the EU can get under way. The EU however, are pushing for negotiations to be started sooner.
It has been reported this week that a new Prime Minister will be in 10 Downing Street by the end of the week, Theresa May is to replace David Cameron. Reports suggest that she hopes to declare Article 50 and begin official procedures for the UK to leave the EU by December.
As a business that works with EU Countries and helps people to buy mobile homes abroad, Caravans in the Sun remains positive about the outcome and what the future could hold. Although the vote did not go the way that 48 per cent of the nation would have liked, we must remain positive of what opportunities and outcomes a Brexit could bring.