Expat ISA Rules: What can be done with an ISA when living overseas?

We all know that Individual Savings Accounts (ISAs) are incredibly tax-efficient savings and investment vehicles for UK residents.

However, for those of us who leave the UK, things become more complex. 

Here are answers to some of the most common expat ISA questions that I have come across.

Can I open an ISA while living overseas?

No.

Can I keep an existing ISA open, once I move abroad?

Yes.

However, you should inform your ISA provider as soon as you stop being a UK resident.

Can I pay into an ISA if I live abroad?

No. 

If you open an ISA in the UK then move abroad, you cannot put money into it after the tax year that you move (unless you’re a Crown employee working overseas or their spouse or civil partner).

Can I switch funds within my existing ISA while living overseas?

Yes (but it could be a taxable event in your country of residence, see next question).

Are ISAs still tax-efficient while I live overseas?

It depends on where you live and the double taxation treaty between that country and the UK.

However, most countries look to tax their residents on their worldwide income and/or capital gains.

For example, here in Poland, or in such countries as France, Spain and the US, the ISA structure is not recognised and you would be taxed locally on any gains that you crystalized or any income that you received from your ISA.

Obviously, if you didn’t sell any of your ISA holdings while overseas and subsequently returned to the UK, then the ISA would retain its tax efficiency (except in countries that impose a wealth tax).

Is there a pan-European equivalent to an ISA?

Unfortunately not.


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