French Resident, Brexit, and UK Policies Set Up Before January 2021
Published / Last Updated on 15/07/2022
The French Financial Regulator introduced new rules starting when the UK transition period for Brexit ended on 31st December 2020.
As financial services was not included in the trade agreement, most EU nations have taken a relaxed view that you can still manage, change and switch your UK investments but France in particular has adopted a very strict regime until an agreement is reached between the UK and Europe on financial services. There are 5 Memorandums of Understanding (MoUs) that are being worked on to set out how UK investments can be managed ongoing when you are an EU resident. In short, we expect an agreement for ‘delegated authority’ when EU regulators etc will ‘delegate’ the authority of regulation for a UK pension or investment to the UK regulator and UK authorised advisers.
This affects your ability to manage existing pensions and investments, transfer between policies and make changes to existing schemes set up before 1st January 2021.
The following notes apply to French Residents with UK plans in force before 01/01/2021.
Annuity
Your existing annuity can continue to be paid to you. New annuities can only be taken out with the existing scheme only and provided it is in the contract that your pension will offer you an annuity. You cannot transfer your pension to a new annuity company.
Banking
Many UK banks are now closing accounts for EU residents, in particular France. If you find this is the case, you will need to advise us or firms making payments to you or vice versa that your account has or will be changing. There are workarounds for this.
Investments
For investment schemes set up before the end of transition, you cannot make additional payments into existing policies. You cannot start a new investment plan in the UK. You can still make fund switches and changes to your investments, and you can still cash them in.
Life Insurance Protection
You cannot make any changes to the percentage or premiums you currently pay in or add any one-off payments to your policy, although this might be possible if the change in payment is already clearly set out in your policy terms and conditions and doesn’t need any instruction from you or us to implement this. You cannot start any new life insurance policy in the UK.
Online Changes
Most UK firms have stopped French residents making online changes to their UK policies. You will need to contact us, or your pension and investment firms direct to make changes where possible.
Pension Drawdown
Existing drawdown pensions can continue for both regular drawdown payments, ad-hoc payments, and lump sums. You can also make fund changes or switches. You cannot transfer in another pension into your existing drawdown scheme.
Private and Company Pensions
You can make changes to existing schemes e.g., change funds, take out an annuity or drawdown provided these options were already in the contract terms. If options such as flexible drawdown are not available in your existing pension, you cannot transfer to a new pension.
You cannot change payments or % being paid into an existing scheme (if you are still able to pay in) unless it is contractually allowed e.g., part of your employment contract.
You cannot make one of payments or transfer other pensions into your existing pension.
Summary
Provided your scheme was set up before 1st January 2021, you can make many changes provided they are permitted within the contract wording, but you cannot take out new plans. Contractual terms must be clearly set out in the policy terms and conditions of your pensions, investments, and insurance. If they are not clear and specific, you will not be able to make changes.
For schemes set up on or after 1st January 2021, when you were a UK resident but have now moved to France, see video France UK From 2021
