Savings in UK but moving to New Zealand

mothership_2

Assuming my situation is not unique I will update this thread as I visit banks and building societies and gather factual information.

Yesterday I went to Halifax, Santander, Skipton BS and Nationwide

Remembering my issue is that I will not have a UK address for at least 2 years and I don't want to commit to a fixed rate ISA in case the rates change so I can still transfer existing ISA funds (rather than subscribe to a new ISA) to another product with same provider or another one as rates dictate.

Early indications are that branch staff initially believe that you must live in the UK to hold an ISA, this contradicts HMRC's website which merely states you must be a UK resident to subscribe (i.e. pay money in to an ISA) so when you tell them this they generally ask someone else and a different response is forthcoming. It is difficult to ascertain whether you are getting the opinion of the staff member or actual company policy so I have added comments in bold in explanation.

Halifax - no problem having overseas address as all banking transactions can be done online including opening, closing and transferring ISAs. They are also happy to send communications overseas. **very casual attitude, saw bloke on shop floor who seemed a tad distracted, that casualness might indicate that I got his opinion rather than company policy or simply indicative of it truly being no problem whatsoever**

Santander - can have an overseas address but in order to transfer an existing ISA into one of their ISAs whether funds with them already or not you have to physically go to a branch. Cannot happen without them seeing you. **this info conflicts with what a different Santander branch told me last week, I remain unconvinced**

Skipton BS - no problem having an overseas address but you need to provide proof of a new address to have them change their systems - e.g. bank statement etc. otherwise they are happy to use a c/o address for now and change to overseas address once evidence of it has been obtained over time. They reckong their online banking is one of the most secure and ISA's can be opened and transfered online. **this info seemed factual and confidently delivered, the staff reasoned their answers against known policy so it appears to be true**

Nationwide - no issues with foreign address. No problem anticipated transferring ISAs from one of their ISAs to another of their ISAs. **I believe this advice because the cashier had no idea and there happened to be a manager's meeting going on so she asked them, after five minutes I got this very definitive answer**

RetiredInThailand

Aren't banks wonderful?

I think a lot of the confusion arises over the difference between being a new customer from overseas and an existing one who is going overseas. Banks are much more flexible with the second group.

Personally I have always thought that for an ISA you had to be resident at the time of opening and remain so, otherwise it would have to be closed. Though I've never understood the ISA residency requirement anyway.

One other thing that you should be aware of: not all UK banks will accept R105 forms, even if they will accept you having an overseas address. Without the R105 your interest on non-ISA accounts will be paid net and you will have to reclaim the tax.

rockitup

mothership wrote: »

Nationwide - no issues with foreign address. No problem anticipated transferring ISAs from one of their ISAs to another of their ISAs. **I believe this advice because the cashier had no idea and there happened to be a manager's meeting going on so she asked them, after five minutes I got this very definitive answer**

After I moved overseas, I changed my address with Nationwide, they are fine with that and even send out debit and credit cards but I have to activate them before using.
The one thing they will not let me do is open a new account whilst I am overseas. So I miss out on the better interest rates with their newer accounts.

I have a feeling that you may have the same problem with opening new accounts with other banks, to gain better rates once you are overseas.

hermante

mothership wrote: »

2. When does one cease being a UK resident, can you be on holiday and working and still be a UK resident? The plan is to get to NZ and do some casual (could be taxed but I don't know) fruit picking work and travel around for 12 or so months and then get proper jobs for another year and re-evaluate. This uncertainty is why we don't want our UK savings to pay off part of the mortgage and in the event we return to the UK want to have access to ISAs to either draw on them or continue adding to them.

See this http://www.hmrc.gov.uk/cnr/faqs_general.htm

Q3 in particular. I think it depends on how the courts interpret your intentions if HMRC thinks you should be paying tax and you disagree. "Resident" and "ordinarily resident" have different meanings.

You won't be on holiday as you have a spousal visa to NZ. If you were on holiday you would not be allowed to work, unless you held a working holiday visa, in which case you would be expected to return to the UK after 2 years and thus you would be "ordinarily resident" in the UK and may be resident depending on the exact dates.

Note both of you will continue to benefit from the UK personal allowance.

High street banks will not allow you to open accounts if you are registered as resident abroad.

koru

I highly recommend the following website, which is a New Zealand business that specialises in advising UK expats in relation to New Zealand tax and investments:
https://www.broadbaseinternational.com

I have not actually used their services, but the advice on the website seems quite extensive. It also covers UK tax.

mothership_2

rockitup wrote: »

After I moved overseas, I changed my address with Nationwide, they are fine with that and even send out debit and credit cards but I have to activate them before using.
The one thing they will not let me do is open a new account whilst I am overseas. So I miss out on the better interest rates with their newer accounts.

I have a feeling that you may have the same problem with opening new accounts with other banks, to gain better rates once you are overseas.

Is an ISA transfer classed as 'opening a new account' though?

In which case it may be as well to choose a bank/BS based purely on whether they'll permit an overseas address to be used (as it seems that the Nationwide will) and bite the bullet to transfer all ISAs into one fixed rate ISA product at 2012 rates and hope rates don't improve. I will however add the specific question of whether new accounts can be opened whilst outside UK to my future enquiries and keep this post updated with progress.

I'm wondering whether anyone has experience of whether writing to banks/BS with specific questions will reap factual policy responses or just a sh*t load of fliers for accounts through the post?

mothership_2

koru wrote: »

I highly recommend the following website, which is a New Zealand business that specialises in advising UK expats in relation to New Zealand tax and investments:
www.broadbaseinternational.com
/QUOTE]

Yes, this website was firmly in my favourites and is a source of much very useful info, leaves you almost wondering how they make any money when such huge amounts of very sound information is offered free.

kimbles

mothership wrote: »

In September 2012 my partner and I are planning to relocate to New Zealand for a couple of years with a view to permanency depending how we find it (she's from NZ but holds dual nationality I will be on a resident's visa but still a British Citizen). We also own a house which we're planning to rent out paying the mortgage with the rent and banking the rest.

For first 4 years of being in NZ we will not have to pay double tax, so any interest earned on money held in accounts in the UK is effectively tax free anyway.

We currently have about £35,000 sitting in cash ISA's (various fixed terms all due to end before we go) the exchange rate is rubbish so it's not worth converting into NZ$ and we have some savings in NZ we can rely on anyway.

ISA applications seem specific in that you need to be a UK resident with a UK address. Can we ignore that and just bung the lot into 2 or 3 year fixed rate ISA's and forget about it, (if so what about the fact we won't have a current address) or must we stick into standard taxable savings accounts?

Should we find the best rate paying non tax free savings account and use that?

Should we look at NS&I products?

Is it worth looking into offshore savings accounts at all (a quick look at interest rates shows they are not very competitive)

Any help to point us in the right direction would be welcomed.

Hi mothership

Any chance you can talk my OH into doing this? I am a Kiwi and he is British and will dig his heels in at the very mention of the possibility of us moving home to NZ even for a short while.:(

Seriously though, good luck with the move, sorry I can't help with the ISA side of things.

koru

You can keep your existing ISAs:

http://www.hmrc.gov.uk/isa/faqs.htm#14

rockitup

mothership wrote: »

Is an ISA transfer classed as 'opening a new account' though?

In which case it may be as well to choose a bank/BS based purely on whether they'll permit an overseas address to be used (as it seems that the Nationwide will) and bite the bullet to transfer all ISAs into one fixed rate ISA product at 2012 rates and hope rates don't improve. I will however add the specific question of whether new accounts can be opened whilst outside UK to my future enquiries and keep this post updated with progress.

I'm wondering whether anyone has experience of whether writing to banks/BS with specific questions will reap factual policy responses or just a sh*t load of fliers for accounts through the post?

I never bothered with Cash ISA's as I tend to switch from cash to investments a few times each year so can't help with that one, but I would guess that an ISA transfer is still a new account.

Rates for next 2 years lot so? Looks like base rate is not expected to budge till late 2013 or 2014 according to articles i read recently. For that reason I would chance it and go for the certainty of a 2 year or 3 year fix on the ISA.

Be interesting to read any more info you find out regarding accounts for NR's. There is nothing to stop the banks opening accounts for us, it is just that it requires more hurdles to be jumped because of "Know your customer" requirements. I opened a Trading account with TD Waterhouse last year, this has the share dealing account plus multi-currency bank accounts (don't get excited though, interest rates are pitiful!). But in order to open it I had to get Citibank where I am living to give information about my address and how long I held accounts with them, Citibank also kindly certified copies of passport and utility bills.

TD Waterhouse accepted this but the extra legwork does lie with the customer, so why can't other banks accept NR's as new customers (some day they may sort out these KYC and Anti-ML regulations but I am not holding my breath)...