"Move" to UK for 3 years?

[BarbWire]

I've been searching various expat forums but can't really find what I'm looking for, so I thought I'd try here.

Background:

• Dual US/UK citizen. Lived in the UK for three years at Uni, otherwise in the US. No relatives left in the UK.
• SINK (Solo, no kids). Age 62. FIRE'd comfortably six years ago, sold the Texas house three years ago, and have since been a nomad, about half of the time in North America in my van, otherwise with a backpack in EU or Asia.
• Do not get ACA subsidies, so currently pay nearly $1000/month in premiums with a $7000 deductible -- for lousy insurance. Can't modulate income to subsidy levels without huge cap gains taxes, so probably not worth it for three years til Medicare. (Cap gains tqaxes would be greater than ACA savings). Very healthy.
• Portfolio is about half tax-deferred, half taxable. (Alas, the taxable half is not at all tax-efficient, due to young investing mistakes.)

Suppose now, as a world traveler, that I do not return to the US for the next three years -- or at most for 30 days each year. Instead, when I need to "perch" somewhere, I perch in the UK for, say, a month or two at a time in a short term let, exploring different regions. And I would travel the world on my UK passport rather than my US passport.

QUESTION 1: in order to be shed of my dreadful ACA health insurance plan and to get better health insurance as an expat, would I have to make some sort of formal declaration that I was residing in the UK -- even if I don't maintain a home there?

QUESTION 2: If I do become a UK resident (and I'm still trying to figure out what that means if I don't maintain a home) what are the tax implications (US and UK) for my US investment-based income?

Sorry, but these questions are as clear as mud. I'm flailing as I try to think this through.

If someone here could address these questions or point me to US/UK expat forums where I might research these issues, I would be grateful. The forums I have found thus far deal largely with visas, working, relocating families, and how to find favorite US foods in the UK.

Thank you.

 

[ShokWaveRider]

I am sure Alan can give you all the answers you will ever need.

One question, can you put up with the weather?

 

[Alan]

I've been searching various expat forums but can't really find what I'm looking for, so I thought I'd try here.

Background:

• Dual US/UK citizen. Lived in the UK for three years at Uni, otherwise in the US. No relatives left in the UK.
• SINK (Solo, no kids). Age 62. FIRE'd comfortably six years ago, sold the Texas house three years ago, and have since been a nomad, about half of the time in North America in my van, otherwise with a backpack in EU or Asia.
• Do not get ACA subsidies, so currently pay nearly $1000/month in premiums with a $7000 deductible -- for lousy insurance. Can't modulate income to subsidy levels without huge cap gains taxes, so probably not worth it for three years til Medicare. (Cap gains tqaxes would be greater than ACA savings). Very healthy.
• Portfolio is about half tax-deferred, half taxable. (Alas, the taxable half is not at all tax-efficient, due to young investing mistakes.)

Suppose now, as a world traveler, that I do not return to the US for the next three years -- or at most for 30 days each year. Instead, when I need to "perch" somewhere, I perch in the UK for, say, a month or two at a time in a short term let, exploring different regions. And I would travel the world on my UK passport rather than my US passport.

QUESTION 1: in order to be shed of my dreadful ACA health insurance plan and to get better health insurance as an expat, would I have to make some sort of formal declaration that I was residing in the UK -- even if I don't maintain a home there?

QUESTION 2: If I do become a UK resident (and I'm still trying to figure out what that means if I don't maintain a home) what are the tax implications (US and UK) for my US investment-based income?

Sorry, but these questions are as clear as mud. I'm flailing as I try to think this through.

If someone here could address these questions or point me to US/UK expat forums where I might research these issues, I would be grateful. The forums I have found thus far deal largely with visas, working, relocating families, and how to find favorite US foods in the UK.

Thank you.

I PM'ed you with my 2 favourite sites where I have been a member for several years. Far better to ask detailed questions there than here.

We also did a couple of trial runs staying here for several months at a time before deciding to move back.

QUESTION 1: in order to be shed of my dreadful ACA health insurance plan and to get better health insurance as an expat, would I have to make some sort of formal declaration that I was residing in the UK -- even if I don't maintain a home there? Yes, you would have to be a tax paying resident. Citizenship does not provide free access to the NHS.

QUESTION 2: If I do become a UK resident (and I'm still trying to figure out what that means if I don't maintain a home) what are the tax implications (US and UK) for my US investment-based income? As a US Citizen you have to pay tax on all your worldwide income no matter where you live so as a UK resident you pay UK taxes on your worldwide income and when you file your US tax return you claim back those taxes paid to the UK as foreign tax credits. UK taxes are extremely easy to calculate so you can estimate ahead of time and compare UK taxes against US taxes plus healthcare costs.

 

[ShokWaveRider]

Alan: A little off subject but still applicable if moving and buying property, How are county Council Taxes (RE Property Tax) calculated/levied? When I look at the tables it seems to be fixed depending on the county, but I am sure it varies with the price of the home.

Thanks

 

[pdxgal]

BarbWire, re: insurance, there are several companies that offer international health insurance for travelers and "digital nomads". Google with quickly find them for you. One is based in the UK (BUPA?). The premiums are fairly inexpensive. Not sure if you have to be a resident anyplace to qualify though.

 

[Alan]

Alan: A little off subject but still applicable if moving and buying property, How are county Council Taxes (RE Property Tax) calculated/levied? When I look at the tables it seems to be fixed depending on the county, but I am sure it varies with the price of the home.

Thanks

It is exactly how you describe. Use Google to look up the County and see their annual payments per “band”, then use Rightmove, Zillow etc to see what the band a particular house is in. Smaller houses are in band A, largest houses are in band F (or higher).

Relevant to the OP, the council tax is paid by the tenant, not the owner, so that needs to be considered, as the rent of a house does not include tax. (Furninished Vacation houses do have tax included)

 

[Alan]

BarbWire, re: insurance, there are several companies that offer international health insurance for travelers and "digital nomads". Google with quickly find them for you. One is based in the UK (BUPA?). The premiums are fairly inexpensive. Not sure if you have to be a resident anyplace to qualify though.

Good point.

Remember that you will need to maintain insurance in the USA because you may have a major incident that requires repatriation.

 

[jj]

Do you have heirs? The one thing that prevents us from seriously considering a move back to the UK is that we would regain our UK domicile and our estate would be subject to inheritance taxes.

 

[truenorth418]

Two other expat health insurance options are Cigna International and Aetna International. I chose Aetna as it had the better rate for more comprehensive coverage. Yes they will take pre-existing conditions into consideration. But in my experience it is still less expensive than what I was paying for Obamacare back in the states. Get an online quote from each, then do a follow up call to iron out the details to see if this would work for you during a few years in the UK.

 

[FIREd]

BCBS offers travel health insurance as well (look for "GeoBlue"). For trips lasting less than 6 months, they offer a fairly cheap stand alone policy with no underwriting ($1M benefit cap). IIRC I paid less than $500 for 6 months of coverage.

But they offer long-term policies as well (requiring underwriting) as well as supplemental insurance for US-based health insurance policies.

 

[Clover5]

There are many global insurance companies that provide travel coverage or in country coverage. Here in Mexico a private policy that has decent coverage in Mexico is very reasonable and is available to temporary visa holders.

 

[ShokWaveRider]

There are many global insurance companies that provide travel coverage or in country coverage. Here in Mexico a private policy that has decent coverage in Mexico is very reasonable and is available to temporary visa holders.

Assuming you are not over 65.....

 

[ivinsfan]

It is exactly how you describe. Use Google to look up the County and see their annual payments per “band”, then use Rightmove, Zillow etc to see what the band a particular house is in. Smaller houses are in band A, largest houses are in band F (or higher).

Relevant to the OP, the council tax is paid by the tenant, not the owner, so that needs to be considered, as the rent of a house does not include tax. (Furninished Vacation houses do have tax included)

So for example on the famous HH international they have done quite a few London area based rentals. When the show says this flat costs 2000 lbs a month if you are the renter..do you add the council tax to your monthly costs? I have the option of a British passport..(London born to a British Mom and US Army Dad) but have never exercised it.

 

[Alan]

So for example on the famous HH international they have done quite a few London area based rentals. When the show says this flat costs 2000 lbs a month if you are the renter..do you add the council tax to your monthly costs? I have the option of a British passport..(London born to a British Mom and US Army Dad) but have never exercised it.

Exactly right. When we did a trial 7 month stay in 2011 and again in 2016 the rent was £650/month and the council tax was an additional ~£200/month. Both houses were “band D” which, for this council, is ~£2,400/year for a band D property.

 

[BarbWire]

Thanks to all for the quick replies -- and the PM.

I have a lot more research to do, but on first glance -- if I define my true goal as having medical coverage globally while not paying for a US policy that is not well suited to me -- it seems that I should not formally relocate to the UK but rather look further at global expat health plans. I've looked at a couple in the past, but they were supplemental to a US plan.

I shall dig further. I wish my google skills were not so pathetic....

Thanks again for pointing me in new directions!

 

[Alan]

Thanks to all for the quick replies -- and the PM.

I have a lot more research to do, but on first glance -- if I define my true goal as having medical coverage globally while not paying for a US policy that is not well suited to me -- it seems that I should not formally relocate to the UK but rather look further at global expat health plans. I've looked at a couple in the past, but they were supplemental to a US plan.

I shall dig further. I wish my google skills were not so pathetic....

Thanks again for pointing me in new directions!

Note what I said above that if you are not resident in any country then if you drop your US insurance and develop a chronic illness such as cancer or heart disease your travel insurance is unlikely to cover you for lengthy treatment and with no US insurance you may end up in financial jeopardy. Since you are only 3 years from Medicare it may be a risk you are prepared to take, as long as you understand the risk.

 

[ShokWaveRider]

I am English and DW is Canadian, if the weather was not so dreary in the UK, we would probably move there tomorrow. Canada is too cold in winter and the Canadian NW is dreary like the UK.

We are so spoilt having lived in places for the last 35 years than basically do not get below 50*F and have high sunshine hours.

Very annoying as a lot of the places with sensible Healthcare, that we have access to, have unsatisfactory weather.

Australia has changed the rules (so much for no rules ), you need $5 - $15m to invest to gain residency, used to be $1.5m (Aussie Dollars).

 

[Amethyst]

Can't speak for the OP, but I loved the weather during our 3 years in the northern UK. The winters, of course, are long and dark at that latitude, and they can be quite cold; but I've experienced far colder, snowier winters in the northeast U.S. (Maryland to New Jersey).

The same could be said about gray skies and rain during spring and fall - it just didn't seem any worse than what I was used to in the northeastern U.S. Despite my British colleagues firmly expecting me to complain about the rain!

The summers were like 3 months of May, with the added bonus of very long daylight hours. It doesn't get hot in the North of England. It can get pretty hot farther south, and London can be positively sultry in the summer.

I am sure Alan can give you all the answers you will ever need.

One question, can you put up with the weather?

 

[ShokWaveRider]

Can't speak for the OP, but I loved the weather during our 3 years in the northern UK. The winters, of course, are long and dark at that latitude, and they can be quite cold; but I've experienced far colder, snowier winters in the northeast U.S. (Maryland to New Jersey.

Ouch! We have not seen snow for close to 35 years, unless we travelled to it, which is not very often.

 

[jim584672]

I looked into moving to the UK, free NHS is based on being "ordinarily resident". No other criteria is involved. The official docs say you can be covered from day one.

"The longer a person has been living in the UK the stronger the indication they are ordinarily resident here. A period of 6 months is only a rule of thumb and should be used with caution. It is important to note that a person can be ordinarily resident from the first day they arrive in the UK if they have genuinely come to settle for the time being."

https://assets.publishing.service.g..._data/file/736849/Ordinary_residence_tool.pdf

 

[BarbWire]

Note what I said above that if you are not resident in any country then if you drop your US insurance and develop a chronic illness such as cancer or heart disease your travel insurance is unlikely to cover you for lengthy treatment and with no US insurance you may end up in financial jeopardy. Since you are only 3 years from Medicare it may be a risk you are prepared to take, as long as you understand the risk.

Right. Travel insurance would not be appropriate in this case, so I am now searching out "expatriate health plan," "global health care," "International health plan" and "international health insurance policy." There are a handful of products that are designed for people who have no fixed abode (the market has responded to the "digital nomad" phenomenon), so I've spent the afternoon going cross-eyed looking at the fine print of some of the policies.

 

[ivinsfan]

Ouch! We have not seen snow for close to 35 years, unless we travelled to it, which is not very often.

It's just snow, it's not lethal...

 

[Alan]

I looked into moving to the UK, free NHS is based on being "ordinarily resident". No other criteria is involved. The official docs say you can be covered from day one.

"The longer a person has been living in the UK the stronger the indication they are ordinarily resident here. A period of 6 months is only a rule of thumb and should be used with caution. It is important to note that a person can be ordinarily resident from the first day they arrive in the UK if they have genuinely come to settle for the time being."

https://assets.publishing.service.g..._data/file/736849/Ordinary_residence_tool.pdf

That was the case with us. Although initially we had planned to simply set up a second home and split our time between the US and UK we knew that meant us becoming ordinarily resident so from day one we declared ourselves ordinarily resident and registered with our local GP office and received an NHS number immediately. (Since we had last lived in England 29 years ago they had revamped the NHS and now issued new format numbers). I took in my prescription medication from the US and was prescribed the same stuff, which I hadn’t realized was free as I was over 60. Over 60’s also get free eye tests so we did that as well since we were due.

 

[BarbWire]

A quick update:

I've been in conversation with a couple of providers of expat primary insurance plans (Cigna Global, IMG), stipulating that I would want a policy that would give me some coverage for trips to the USA even though the vast majority of my time would be abroad, largely in the UK.

Standard primary expat medical policies are "in-patient" only, so if you add "out-patient" coverage, the costs jump by about 25%. Now, if I break a leg in Thailand, that probably wouldn't need hospitalization and the cost of tending to it be relatively small. But if I break a leg back in the US while visiting family, the cost could be huge if I don't have outpatient coverage. (I ran this scenario past both companies and they agreed). So out-patient coverage seems like it might be sensible.

In the end, the cost of a decent primary expat policy that covers out-patient AND covers up to 90 days in the US isn't much less than my BCBS policy ($750/month) -- though the former has a $0 deductible while my BCBS policy has a $6000 deductible and scant out-of-network protections. Deductible and networks might seem to tip the balance in favor of the expat policy.

Suppose, however, I were seriously injured somewhere, evac'd to the US, and used up my 90 days in the US. Suppose I wished to continue treatment there (think, for example, a traumatic injury in a motor vehicle accident). I couldn't just "move" back to the US at that point and have special enrollment in an ACA plan because you can only have special enrollment if you already have coverage. I suppose this makes sense to prevent people from saying "I won't buy coverage until something happens..."

So, while I spend the coming year doing a multi-month trial run in the UK, in addition to some time in the US and elsewhere, I *think* the best strategy will be to continue (and re-up) my US policy (however expensive and weak ), keep my Medjet evacuation policy, and buy travel medical insurance.

If I do decide to permanently move to the UK in 2021 or 2022, this is all up in the air again.

BOTTOM LINE: If I thought I would *never* seek medical care in the US, I might grab an expat policy. But until that is absolutely true, I think it makes sense to keep hold of US coverage and supplement with "travel" secondary insurance.


Better to spend a bit more while exploring possible life options that to have massive non-buyer's remorse later!

 

[Alan]

Once you become resident in the UK then travel insurance to the USA becomes very affordable. Banks like Barclays and HSBC provide free travel insurance, including health, for their customers up to age 70, as long as the trip begins and ends in the UK and lasts no longer than 31 days. (We completed a 30 day multi country trip including the USA earlier this year).

Our dentist’s father got really sick on a trip to Florida a year or 2 back and his travel insurance covered the $35k bill from the hospital he spent some time in following liver problems.

ETA
If you do have private insurance in the UK that would almost certainly cover vacations to any country including the USA.