Fed-up with their pensions being “systemically raided” by the UK Government, a growing number of Britons are planning to up-sticks and move to Cape Town, taking their pensions with them, say personal finance analysts. For many British retirees, and for
With even fewer incentives to keep funds in the UK, there has been a “dramatic increase”, according to experts, in enquiries from Britons who are now intending to enjoy their retirement on the south-west tip of South Africa.
Craig Featherby, the Cape Town-based Regional Manager of the deVere Group, the world’s largest independent financial advisory firm, says: “Foreign pensions are not taxed in South Africa, meaning Britons who come to live here can receive a tax-free pension.
“But if they remain in the UK their funds will be subject to all kinds of, and an increasing amount of, taxation. Who wants, or who can afford, that?”
Under South African legislation, for those who move to the country and transfer their funds into an HM Revenue and Customs-approved ‘Qualified Recognised Overseas Pension Scheme’ (QROPS) five years before they retire, the income is received tax-free.
With its sophisticated urban centres; breathtaking natural landscapes including Table Mountain and Cape Point, the vine-covered slopes of Constantia, and some of the world’s finest beachside communities; plus its friendly, English-speaking, Afro-Euro vibe, the Cape Town area has long been a favoured destination for expats wanting a sun-filled retirement.
“Since moving to Cape Town, and transferring our pensions, we’re able to afford a better standard of living than our friends and family back in the UK,” explains Andrew Kinsella, who moved to the leafy residential suburb of Bishopscourt with his wife six years ago.
“Our quality of life is a significantly higher than when we lived in Britain.”
As the effects of the Budget hit, it is widely expected for this trend, which is already being keenly felt, to continue.
“The Budget was a ‘wake-up call’ for the millions of people who have worked hard all their lives to put money aside for their retirement. But an increasing number of them are wising-up to the overseas opportunities,” affirms Mr Featherby.