HELPLINE: 
Today’s case study looks at why you should liquidate UK ISAs before moving to France.
The situation. Simon and Katie*, a British couple in their fifties, are planning to retire in France. They have significant savings in UK Individual Savings Accounts (ISAs): Simon holds £100,000 in stocks and bonds, while Katie has £50,000 in a cash ISA.
Note, ISAs are tax-free in the UK, but not in France. Income from dividends and interest are taxed at 30% in France and withdrawals will also incur taxation.
Pre-move plan. To avoid costly tax complications, we proposed this strategy:
- ISA liquidation. Sell ISAs before relocating, securing the gains tax-free under UK rules.
- Secure assurance vie. They reinvested the £150,000 in French assurance vie policies. These allow tax-deferred growth and offer favorable withdrawal terms after eight years. Simon’s portfolio focuses on low-income, growth-oriented funds, while Katie’s includes multi-currency options for risk tolerance.
- Preserve access. Katie retained £25,000 in her cash ISA for immediate needs, budgeting for the 30% flat tax on the annual interest until it is gradually reinvested.
Takeaway. By planning ahead they sidestepped the French tax burden on ISAs and opted for tax efficiency, secure growth and flexibility through assurance vie, a smart solution for retirement in France.
Need to safeguard your financial future when moving abroad? Contact us for expert guidance.
*Names and identifying details have been changed to protect privacy.