Many UK citizens may lack 'sufficient income' to get EU residency

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Many UK citizens may lack 'sufficient income' to get EU residency

UK citizens seeking residence in an EU country must now demonstrate that they and their dependants have sufficient income not to be a burden on the state, and many popular expat investment structures do not generate ‘sufficient income', warns international financial advisory group Blevins Franks.

The interpretation of what constitutes income varies from one country to another and the sum regarded as ‘sufficient' is defined differently in each state.

Jason Porter, director of Blevins Franks and head of its new European Emigration Advisory Service, said: "This raises a problem for many expats who have invested in EU-compliant, tax-efficient investment products.

This raises a problem for many expats who have invested in EU-compliant, tax-efficient investment products."

"Many have placed their financial assets in life insurance bonds or UK pension schemes and intend to utilise the flexible and often tax-efficient withdrawal facilities associated with such structures.

He added: "The potential irregularity of payments and the fact some of these may not be regarded as wholly constituting income could have consequences in terms of meeting the sufficient income requirements of a residency permit.

"Some jurisdictions have developed an interpretation that a simple deposit of the income required for the period of the residency permit in an account which can be drawn upon is sufficient. Others are far stricter, expecting to see income in its regular, taxable form, such as earnings, pensions, rentals, dividends or interest.

Porter also said these expats will need to take advice on what is effectively a balancing act between tax efficiency and meeting the income stream requirements of the residency permits best suited to them.

Expats will not be granted a residence visa unless they can demonstrate this income stream. They need to be in receipt of a visa before they can spend more than 90 days in an EU country.