06/03/2019
According to figures from the UN, there are currently around 1.3 million British expats living in Europe.
Under the existing rules, retirees living in countries within the European Economic Area are entitled to see their state pension increased each year in line with the triple lock. It is unclear at the moment whether exiting the EU will mean the end of this arrangement, unless the UK is able to negotiate reciprocal arrangements with individual EU nations.
Retirees will be entitled to the state pension they have built up, but it may be that those pension payments are frozen. This would mean that in real terms the value of those pensions would fall each year, as a result of inflation. Its important to remember that this has not been fully clarifies as yet.
Defined benefit, or final salary, pensions are based on an arrangement between employer and employee. As a result, they should not be affected in any material way by Brexit, while there is no impact on the structure of defined contribution pensions either.
What does it mean for expats who have a private pension? A ‘No Deal’ Brexit could mean that private UK companies have problems paying out, say, an annuity to a UK citizen in the EU. There could be cost issues, and the question of exchange rates for companies transferring money.
