Leaving The UK? Here’s What Happens to Your Assets and Investments

Thinking about leaving the UK? 🤔

This appears to be a growing trend as more people are considering leaving for various reasons such as higher taxes in the UK, declining living standards or even better weather. 

We've seen people in and around our lives move to UAE (Dubai and Abu Dhabi), Bermuda, Ghana, Kenya, Canada, USA, Portugal, etc. 

We have personally seen a mix of Doctors (e.g. to Canada), entrepreneurs (e.g. to Dubai), investors with assets, and others with other careers including those without many assets to their names.

The Doctor (GP) friend who's leaving for Bermuda said he is leaving because his income would be 250% higher and he'd pay no income tax. Plus less hassle.

Have people you know relocated or planning to? Comment below and share.

Whether planning a few months abroad each year or a permanent move, have you considered what will happen to your ISA, pension, property, investments—and even your crypto and gold?

We’ll cover all this and more in today’s post by looking at two scenarios:

• Scenario 1: Part-year residency (living abroad for 3–6 months, but returning to the UK for the rest of the year)
• Scenario 2: Permanent departure from the UK.

Then, we’ll bring this to life with real-life case studies of two people 😀.

One with part-year residency between the UK and Spain, and a second scenario of someone moving permanently to Dubai.

Don’t miss the bonus at the end of the post where we’ll share a 10-step checklist of things you should start doing now if you plan to leave the UK in the near future.

If all this sounds good, please take a moment to share this post with family and friends.

My name is Ken Okoroafor and I’m a Chartered Accountant, a Financial Coach and Business Coach and a former CFO.

The other half contributor is my wife, Mary, a Creative Entrepreneur and former E-business Analyst.

Together, we’re founders of The Humble Penny and Financial Joy Academy.

We are the Sunday Times Bestselling Authors of Financial Joy, a 10-week Plan to help you Banish Debt, Grow Your Money and Unlock Financial Freedom.

Please see this post as a starting point in your research.

Always check the local tax rules and consult with a tax professional when dealing with cross-border financial matters.

Part 1: What Happens to Your UK Assets and Investments 

We’ll talk about this in the context of 2 scenarios:

Scenario 1: Part-Year Residency (For example, Living 3–6 Months Abroad, Remainder in the UK)

This is the most likely scenario for a lot of people who want to live in the UK in the Spring and Summer months, but live somewhere warmer during the Winter and Autumn months.

Tax Residency Status:

• Under the UK’s Statutory Residence Test, if you spend more than 183 days in the UK in a tax year, you remain a UK tax resident.
• Split residency means you may need to file taxes in both countries.

For example, if you spend more than 183 days in the UK but also spend significant time in Another Country (say, 120 days or more) and that country has a similar rule, you could meet the residency criteria in both places.

Scenario 2: Permanent Departure (Non-Resident)

Tax Residency Status:

• Once you permanently leave, you become a UK non-resident.
• Non-residents are taxed only on UK-sourced income (with some exceptions).

Given both of these scenarios, Let’s now talk about your tax-advantaged accounts and what happens to them when you leave the UK:     

ISAs (Individual Savings Accounts)

Here is What Happens:

Existing ISAs remain tax-free in the UK if you’ve not sold your investments and taken the money with you. 

What about Contributions to the ISA?:

This is only permitted if you’re a UK resident (or eligible Crown employee).

Here are some Considerations Abroad:

If you leave the UK, some countries do not recognise the tax-free status of the ISA.

Income or gains might be taxable locally.

For example, in the United States, Australia, Canada, Germany, and France, the special tax treatment afforded to ISAs in the UK is not recognised.

Consequently, any income or gains could be subject to local taxation. 

In jurisdictions with little or no personal income tax—such as the United Arab Emirates—even if the ISA tax exemption isn’t formally recognised, the overall tax environment might still result in little to no tax on your ISA earnings.

UK Pensions

So What Happens?

Your pension continues to grow tax-free.

When you withdraw, tax rules differ if you’re a resident vs. non-resident.

Typically, up to 25% can be taken as a tax-free lump sum.

Options Abroad:

Cnsider transferring to a QROPS (Qualifying Recognised Overseas Pension Scheme) if leaving permanently—but be aware of transfer fees and tax implications. 

QROPS (Qualifying Recognised Overseas Pension Scheme) is an overseas pension scheme that meets specific requirements set by HM Revenue & Customs (HMRC) in the UK.

It allows individuals who have accumulated UK pension savings to transfer their pension funds to an overseas scheme when they leave the UK permanently.

Double Tax Treaties are worth mentioning:

These may prevent double taxation on your pension income.

Let’s now talk about non-tax-advantaged accounts.

General Investing Accounts

What Happens when you leave the UK?

Gains, dividends, and interest are taxed under standard UK rules.

What’s the Residency Impact?

If you’re deemed a UK tax resident (even part of the year), you’ll likely be taxed on worldwide gains.

As a non-resident, you’re generally taxed only on UK-sourced income.

 Let’s talk about Alternative Investments

Cryptocurrency (e.g. Bitcoin)

What Happens to this?

In the UK, realised gains are subject to Capital Gains Tax (CGT).

Residency Impact?

UK non-residents may not face UK CGT on crypto trades—unless the gains are considered UK-sourced.

However, the new country of residence may tax crypto transactions as part of worldwide income.

Gold and Precious Metals

What Happens?

This is treated similarly to other capital assets; subject to CGT upon sale, for example, gold bars.

Note that there is no tax on UK legal tender coins, such as Britannias and Sovereigns.

Residency Impact?

UK non-residents may only be taxed on UK-sourced gains.

Always check local tax laws, as some jurisdictions tax worldwide capital gains.

Property Ownership

First, Your Principal Private Residence (PPR) i.e. where you live as home. 

What Happens:
If the property has been your principal private residence, you may be eligible for PPR relief, which can exempt you from CGT on the sale.

Considerations for Those Leaving the UK:

• If you move abroad and the property ceases to be your main home (for example, if you convert it to a rental property), you might lose some or all of the PPR relief.
• The timing of your move and sale is crucial; selling while it’s still your principal private residence may allow you to claim full relief, whereas a later sale could result in CGT liabilities.

Additionally, if your new country also taxes capital gains, double taxation treaties may help mitigate the impact, so consult a tax professional to understand how these rules apply in your situation.

What about Rental Income?

• Rental income from your UK property is subject to UK tax.
• Non-resident landlords must comply with HMRC’s Non-Resident Landlord Scheme.

What about Capital Gains on Sale of Property?

If you sell a UK property as a non-resident, you’re liable for UK Capital Gains Tax (CGT) on any gains made.

Rental income or gains from selling your property may be taxable both in the UK and in your new country of residence.

Double taxation treaties between the UK and your destination can help prevent paying tax twice on the same income or gains.

Record Keeping is important.

Keep detailed records of days spent in each country and income from all sources.

Let’s now make this real in

Part 2: Relatable Case Studies

Here are some case studies to make this real.

Case Study 1: Sarah who has Part-Year Residency

Profile:

Sarah is 35, an Online Business Manager, and due to flexibilities with her remote work, she spends 9 months of the year in the UK to be closer to family and 3 months in Spain.

Her Assets are:

• Stocks and Shares ISA: £22k
• Pensions: £30k
• General Investing Account: £5k 
• Rental property in the UK: £50k equity
• Bitcoin: £1k
• Physical gold stored in a secure facility in the UK

Here is what might happen to those assets:

1) First, let’s talk about Tax Residency:

Because Sarah spends more than 183 days in the UK, she remains a UK tax resident.

2) ISAs & Pensions:

Her ISA continues to grow tax-free and so does her pension, although she'll pay UK tax on 75% of her pension on withdrawal.

She is less likely to be considered a Spanish tax resident under Spanish law as she only stays there for 3 months.

3) General Investing Account:

Gains are reported on her UK tax return.

4) Crypto & Gold:

UK CGT applies when she sells and realises gains. Nothing to report in Spain.

5) Property

Rental income is fully integrated into her UK tax filings.

Lesson from partly leaving the UK:

Sarah needs to coordinate tax filings in the UK and understand both UK and Spanish tax rules to make sure her “center of vital interests” is not seen to be in Spain. 

Case Study 2: James – Permanent Departure to Dubai

Profile:

James is an Entrepreneur aged 45, married and has 1 young child.

He and his wife are fed up with UK life and have chosen to move permanently to Dubai.

Assets:

• Stocks and Shares ISA:£20k
• General Investing Account:£10k
• UK Pension:£100k
• UK Rental Property: Equity Valued at approximately £200k
• Online Business: Generating six figures a year, with an estimated valuation of around £300k
• Crypto & Gold Portfolio: Valued at roughly £20k

Tax Residency:

Upon relocating to Dubai, James becomes a non-resident for UK tax purposes. Generally, he will only be liable for UK taxes on UK-sourced income.

ISAs

His Stocks and Shares ISA remains in the UK and continues to grow tax-free, although he can no longer contribute since contributions are limited to UK residents.

UK Pensions

James can either keep his pension in the UK or consider transferring it to a QROPS designed for UAE residents.

Withdrawals will generally be taxed in the UK, but thanks to the favourable tax environment in Dubai—and the provisions of the double taxation agreement between the UK and the UAE—he may avoid being taxed twice.

General Investing Account

Only income from UK-sourced investments (such as interest from UK bank accounts) remains subject to UK tax.

In Dubai, where there is no personal income tax, worldwide investment gains are typically not taxed locally.

Crypto & Gold Portfolio

Any gains from his cryptocurrencies and gold remain subject to UK Capital Gains Tax (CGT) on UK-sourced transactions.

Dubai generally does not tax these gains, but James must ensure he meets all UK reporting requirements.

UK Rental Property

Rental income from his UK property continues to be taxed under UK law, and any sale of the property will incur UK CGT.

If the property had ever been his principal private residence, he might have had access to reliefs, but once converted to an investment property, such relief may no longer apply.

Online Business

If James’s online business is registered in the UK or generates UK-sourced income, its profits will continue to be subject to UK taxation.

However, if he restructures the business or shifts its management to Dubai, he could benefit from Dubai’s favourable tax environment.

The precise tax treatment will depend on the legal structure of the business and the extent to which its income is considered UK-sourced.

Professional advice is essential to navigate these issues and optimize his overall tax position.

Lesson from leaving the UK:
By moving to Dubai, James takes advantage of a favourable local tax regime—especially for personal income and investment gains.

However, he must still navigate the complexities of UK taxation on assets such as his ISA, pension, rental property, and potentially even his online business if it remains UK-registered or generates UK-sourced income.

Detailed planning and professional advice are crucial for managing these cross-border tax rules and making the most of double taxation agreements.

Our Personal Take on Leaving The UK

Life in the UK has been great for me and my family and I will always be a British Citizen and continue to contribute in multiple ways.

I continue to love many things about the UK, however, it's also clear that things are tougher and overall quality of life is declining. 

People are struggling, the cost of living and taxes continue to rise, and overall morale is low. 

If one can, it's certainly a good idea to think globally and explore opportunities that serve them better around the world.

However, it's a very individual choice.

As for me and my family, we continue to live and enjoy life in the UK. 

I can't see us just leaving completely for many reasons. 

We've fought to move here, live here and made a life here.

Plus, we have ageing parents in the UK and we'll always need to be around them.

That said, the cold weather here is crushing and our ideal is to live partly in the UK and partly somewhere warmer for a few months in a year.

Where that is remains a mystery.

What matters most to us is having the freedom and finances to move around the world, which is both a blessing and priviledge.

For now, we plan to travel to different locations to see what living partly in other places could look like.

👉🏽 What do you plan to do? Relocate or stay? Comment and share 😀

Ok, here is the bonus I promised…

10-Step Leaving The UK Checklist 🗒

Before you pack your bags and set off on your new sunny adventure, there are several critical steps you should take at least 12 months before leaving the UK.

Here's a comprehensive checklist to ensure a smooth transition.

1. Review Your Tax Residency Status
   • Familiarise yourself with the UK’s Statutory Residence Test.
   • Understand how your planned move affects your tax obligations both in the UK and your destination country.
2. Consult a Tax Advisor/Financial Planner
   • Schedule a meeting with an advisor experienced in cross-border finances.
   • Discuss the impact on your pensions, ISAs, general investments, and any alternative assets like crypto or gold.
3. Research Double Taxation Treaties
   • Identify which treaties exist between the UK and your new country.
   • Learn how these treaties can help you avoid being taxed twice on the same income.
4. Notify HMRC of Your Plans
   • Prepare to file form P85 once you leave, and inquire about any tax refunds or obligations.
   • Start gathering the documentation you’ll need for a smooth exit from the UK tax system.
5. Assess Your Asset Strategy
   • Decide whether to keep, transfer, or liquidate your UK assets.
   • Look into options like transferring your pension to a Qualifying Recognised Overseas Pension Scheme (QROPS) if you plan on a permanent move.
6. Contact Your Bank and Financial Institutions
   • Ask about international banking services and how your accounts will be managed after you leave.
   • Explore the possibility of setting up an international bank account.
7. Update Your Wills and Estate Plans
   • Ensure your legal documents reflect your new international status.
   • Review beneficiary designations and estate planning to align with your future residency.
8. Plan for Healthcare and Insurance
   • Research healthcare systems and insurance requirements in your destination country.
   • Check if you need to adjust your current coverage or obtain additional international insurance.
9. Secure All Essential Documentation
   • Organise your passports, visas, birth certificates, and other important records.
   • Make digital and physical copies for safekeeping.
10. Arrange Logistics and Notify Relevant Parties

• • Create a moving timeline covering everything from shipping your belongings to finalising travel details.
  • Inform employers, landlords, utility companies, and other relevant parties about your departure.

Conclusion

In conclusion, it’s a case of more money, more problems.

The fewer the assets and commitments you have in the UK, the easier it is to leave the UK and move abroad if that’s what you want to do. 

Different countries have different rules, so it’s important to thoroughly do your research and seek advice specific to your personal circumstances and goals.

Please share this post with others if you find it very useful 😀.

Are you planning on leaving the UK in the next 3 to 5 years? What questions do you have on the back of reading this post?

More to resources on leaving the UK:

• Book 121 Financial Coaching
• 10 Warm Budget-Friendly Places to Retire Globally
• How Much Do You Need To Retire Comfortably?
• No Savings At 40+? Retire In 10 Years Investing £500 a Month

Here is what to watch next about leaving the UK: