How Will the Brexitstension Affect British Overseas Property Investors

With the Brexitstension confirmed until October 31st 2019 how is this likely to affect British overseas property investors? We look at the most popular markets for UK buyers abroad.

British overseas property investors now have until October 31st to purchase abroad in the EU, presuming the new prime minister keeps to the Brexitstension deadline. So what has been happening in our three largest markets for British buyers?

Spain

The Brexitstension should make no difference in Spain, where Brits were the biggest overseas buyers at 17 per cent of the foreign market.

The Spanish authorities have indicated that those who are resident in Spain should not lose access. On March 1, Spain approved a royal decree to adopt contingency measures in the event that the UK leaves the European Union without a deal.

This is the second initiative from the Spanish government in the Brexit arena, having signed off on a treaty with the UK in February permitting British residents in Spain to vote in and stand as candidates in the local elections back in May.

The royal decree covers the rights of British citizens in Spain and will come into force automatically in the event of a no deal and will be suspended only if the UK do not reciprocate with similar rights to Spanish citizens living in the UK.

If you live in Spain for more than 183 days a year, you have a legal obligation to apply for Spanish residency and submit a tax return on worldwide assets and income the year after you become a resident. Holding a Spanish residency card will permit British nationals to travel freely across Spain.

Currently non-EU nationals holding a Spanish residency identity card can travel freely around Europe. If a British person had not become a resident before the UK’s exit from the EU and remained in Spain, then their continued residency will be at the discretion of the Spanish authorities.

France

There are already around 150,000 Brits living in France, and with property purchase generally taking a minimum of three months from start to finish, there is still time to get in before the Brexitstension deadline of October 31st.

For expats, there is useful advice on the Remain in France Together pressure group website (remaininfrance.org). As per in Spain, people who are just moving there need to get their paperwork together urgently. In France, this means applying for a titre de séjour (residency permit) at their préfecture [local administrative office].

Current guidance issued by the French interior ministry indicates that if the UK leaves with a withdrawal agreement, British nationals need to apply for a new residency permit before July 2021 (The end of the 21-month transition period).

Those arriving after January 1, 2021, will need to apply for a ‘third country’ (non-EU) card.

Portugal

The British are again the largest group of foreign property buyers in Portugal, so the Portuguese government has also been keen to welcome British buyers and reassure expats.

The tourist office has been running a €200,000 campaign to reaffirm this European country’s commitment to its ‘oldest ally’ with a slogan of ‘Brelcome, Portugal will never leave you’.

Again, assuming Portuguese nationals in the UK are given the same rights, British expats in Portugal will maintain ‘all their existing rights’ in principle after the Brexitstension deadline.

Over the past few years there’s been an increase in non-Portuguese and non-EU nationals moving to Portugal to take advantage of beneficial tax rates (through the non-habitual resident programme), as well as the ‘golden visa’ for non-EU buyers.

There are also understood to be plans for a ‘green visa’ to encourage Brits to purchase rural properties – ie those outside the more popular urban areas. There are also understood to be plans for a ‘green visa’ to encourage Brits to purchase rural properties – those outside the more popular urban areas.

Obtaining residency in Portugal is still a simple process, requiring a fiscal number (the same as a UK national insurance number), a Portuguese bank account, a copy of your passport, recent proof of your home address and proof of your economic status with a payslip (if employed), bank statements for the past three months and a rental agreement or completion deed if you have purchased a property.

It seems that the Brexitstension will make difference essentially to British overseas property investors, as the welcoming flags will be out at their favourite destinations even after the Brexitstension deadline passes.