Investing in UK funds from abroad

Investing in UK funds from abroad provides a number of ways to diversify your basket. Question is, should you take the plunge?

The regulatory structure in the UK has a big impact on how international investors see the country. This has a big impact on both their choices and the country’s allure as an investment target.

If you are looking to invest as an expat or high-net-worth individual, which is what I specialize in, you can email me ([email protected]) or WhatsApp (+44-7393-450-837).

This includes if you are looking for alternatives or a second opinion.

Some of the facts might change from the time of writing, and nothing written here is formal advice.

For updated guidance, please contact me.

Can I invest in UK funds if I live abroad?

Your eligibility to invest in UK funds is subject to certain rules and restrictions if you live overseas.

You can usually keep your investments in UK funds if you already have them before deciding to reside abroad. The majority of investing platforms situated in the UK will effortlessly maintain your current assets.

Other investing choices that may provide more flexibility and tax advantages for expats include offshore bonds, foreign equities, and offshore accounts.

For foreign investors, offshore investment platforms may offer greater tax perks and access to broader options.

Using an offshore platform or an investment platform in your new residence may be necessary to properly deal with your investments.

When it comes to managing investments abroad, such platforms can be especially useful for foreigners living abroad because of the multi-currency accounts the provide.

Should I invest in UK funds from abroad?

There are plenty of large organizations in the UK, which makes it possible to invest in well-known international companies. Diversification and possibly larger returns can be obtained in this way.

Foreign investors may benefit from the relative stability of the British pound. The UK also has an advantageous business climate, scoring highly for the ease of establishing a corporation. Also seen as adaptable and investment-friendly is the legislative structure.

If you don’t live in the UK, you can have unanticipated taxes on your investments. Currency fluctuations may still affect your investments even though the British pound is stable. You can preserve your current portfolios and ISAs, but after you go overseas, you won’t be able to contribute further funds to your individual savings account.

It may be useful to realize any gains made while you are still a non-resident if you have certain assets that you developed while overseas and intend to return to the UK. By doing this, you may be able to avoid paying UK funds taxation upon your return, especially capital gains tax.

It could be a good idea to hold off on holding UK-based pensions and investments as sustaining a close connection to the UK could result in you losing your non-resident designation and thus require a levy on your part.

Not being a resident of the UK may not exclude you from paying tax on your income earned in the country, including income from specific investments. You may also be subject to income tax in your new nation from the UK. You can typically apply for tax relief if a double-taxation agreement is in effect.

Treaties that avoid double taxes on the same income or gains between the UK and your new place of residency can be helpful. All nations do not have contracts like this one with the UK, though. 

Bottom Line

If you live overseas and invest in UK funds, how much your investments are worth may fluctuate due to currency movements, taxes, etc.

It is important to know the tax laws in your new country. It’s a good idea to speak with a financial advisor to assist you in better managing your finance matters.

Pained by financial indecision? Want to invest with Adam?

Adam is an internationally recognised author on financial matters, with over 760.2 million answer views on Quora.com, a widely sold book on Amazon, and a contributor on Forbes.