Thursday, September 08, 2011

Retiring to France? Join the queue....

I've just picked up this story from the Daily Telegraph with the rather dramatic headline of:

"Expat pensioner exodus: would the last person to leave Britain please turn out the lights".

It's clear that many people of (and coming up to) pension age are looking into a move abroad.  The pensions guy from Standard Life is spot on though when he says:

"Retiring abroad is a dream for many people, but does require careful planning and advice. Many people think living abroad is cheaper than living in the UK, but this isn’t always the case".

As with anything you really must do your homework if you want your move to work.  There is a small but relevant number of expat retirees in my part of SW France and it's always sad to see people arriving with high expectations but then struggling because they haven't done their homework.

The good news is that France is a pretty attractive destination (and not just because of the sunshine, scenery, pace of life, healthcare system and local plonk).

As Leggett Immobilier's respected Chief Executive, Trevor Leggett, says:

"The new wealth tax rules coming into place are making France one of the most attractive destinations in Europe, as the threshold for this tax (ISF) is increasing from €800,000 to €1.3 million. Households with assets of between €1.3m and €3m will be subject to a tax of 0.25% and for assets over €3m the tax will be 0.5%.   

There has also been one recent change to the law on Capital Gains Tax.

Previously, a reduction of 10% per year, beyond the fifth year of ownership, has been applied to the gain calculated. Therefore, sales made beyond the 15th year of holding the property had been fully exempt from CGT and social security contributions.

Now though, the tax due on the sale of these "non primary" residences will be calculated in accordance with the "Indice du Cout de la Construction" (rate of building inflation) at the time of the sale - taking into account the year you bought the property". 

Certainly my experience has been that our move to France has exceeded expectations and we have been truly happy here.  If you're thinking of something similar though you need to take off the rose tinted spectacles and make sure that you have planned thoroughly.  A good starting point is the excellent retirement section on the FrenchEntrée site - you can see it here.

Just for a moment forget location, location, location and think research, research, research.

Bon courage.

1 comment:

Toyin O. said...

Good to know, thanks for sharing.