Don’t Let Weak Euro Countries Pull Down Your Finances

Expats living in countries with weaker Euro economies need to consider a wide-ranging financial review.

Countries like Spain, Greece, Italy and Portugal have increasing debts after the recession and expats need to ensure their financial plans are on track as property, interest rates and taxes are quickly changing.

For instance, big investors are showing a lack of confidence in the economies by demanding interest rate premiums for buying Spanish government bonds in comparison to the price of their German equivalents.

The problem is investors buying debt of these Eurozone countries with weaker economies have no national currency to devalue or manipulate to tackle their financial woes and look to be trapped in years of debt stagnation.

Spanish prime minister Jose Luis Rodriquez Zapatero has already told hid country’s parliament that ‘moderate’ tax rises are needed to keep the countries welfare and social infrastructure functioning after a battering from the recession.

The government is looking to raise an extra 15 billion Euros in tax revenues.

The prime minister did not say which taxes are likely to rise - but hinted income tax would remain unchanged.

Tax on savings, investments, capital gains tax and VAT are all expected targets - as is the 400 Euro annual rebate for taxpayers.

This is a shot across the bows for expats living in the Mediterranean countries that need to look hard at their finances to make sure they are not caught with their assets trapped in an economic shambles.

Offshore Investments

Now certainly is a time to pull together offshore investments to make sure they are working tax efficiently. Other countries are considering similar tax strategies as Spain as they struggle to cope with huge black hole deficits from the recession.

For those with rights to UK pension benefits, putting pension investments in to a QROPS safely out of the way of governments looking to hike tax rates is an option well worth considering.

A QROPS scheme allows the investor to live wherever they wish and pay income tax according to that country’s rules on pension income - but the bonus is the QROPS can ‘live’ in another tax jurisdiction with better potential for growth in a lower tax environment.

Whatever your financial goals or aims, seeking professional highly regulated advice as early as possible from Qrops Adviser, is the first step in securing the best possible life in retirement. Contact us via the contact Qrops Adviser page, call us direct on 0032 (0)2 400 0087 or email us at info@qropsadviser.com.