Taking your ISA, SIPP, or GIA abroad? What changes when you move overseas

UK statutory residence test

The official Statutory Residence Test (SRT) is HMRC's way of deciding whether you're really gone. Here's how it works:

Group 1: automatic UK residency

You'll be considered a UK resident for tax purposes if:

• You spend 183 days or more in the UK in a tax year.
• You have a UK home for at least 91 days, and spend at least 30 of those days there (while not having a permanent home overseas).
• You work full-time in the UK (at least 75% of your working days over a 365-day period).

Group 2: automatic non-UK residency

You'll automatically be considered a non-UK resident for tax purposes if:

• You were a UK resident in one or more of the last three years but spent fewer than 16 days in the UK this tax year.
• You were not a UK resident in any of the last three years and spent fewer than 46 days in the UK this tax year.
• You work full-time abroad, spend fewer than 91 days in the UK, and work fewer than 30 days in the UK.

The "sufficient ties" test

If you don't fit neatly into either category, HMRC checks your "ties" to the UK:

• Family tie. A spouse, civil partner, or minor children in the UK. (Parents, siblings, grandparents, and hamsters don't count.)
• Accommodation tie. A UK home available for at least 91 days (and you stay there at least once).
• Work tie. You work in the UK for at least 40 days in the tax year.
• 90-day tie. You spent more than 90 days in the UK in either of the previous two tax years.
• Country tie. You spent more days in the UK than in any other single country (but only if you were UK resident in at least one of the last three tax years).

The more ties you have, the less time you can spend in the UK before being considered a resident:

Ties	UK days allowed
1 tie	Up to 120 days in the UK
2 ties	Up to 90 days
3 ties	Up to 45 days
4 ties	15 days or fewer

So, if you have four ties back to Blighty, even a quick weekend trip back for Aunty Betty's 70th birthday bash could make you a tax resident.

Case study: Rita's residency misstep (fictional example, based on real tax rules)

Rita swapped London for Bali but still visits the UK for work and the occasional pub roast.

She doesn’t fit into Group 1 (automatic UK resident) or Group 2 (automatic non-UK resident). She spends more than 16 days in the UK each year but fewer than 183, keeping her in tax limbo.

HMRC counts up her ties: she stays at a friend's flat (accommodation tie), works short contracts (work tie), and spent over 90 days in the UK across the last two years (90-day tie). That's three ties, meaning she can only spend 45 days a year before becoming a UK tax resident.

Last year, she stayed 50 days. That extra weekend? It cost her her non-resident status. Goodbye Bali beach life, hello HMRC's cold embrace. Hope that pub roast was worth it, Rita.

ISAs: keep, but no more contributions

You can keep your ISA when you leave the UK, but you can't contribute to it unless you're a Crown employee working abroad (or their spouse/civil partner).

Here's where things get tricky: while ISAs are tax-free in the UK, your new country might not roll out the red carpet for them. Other countries won't recognise ISA's tax-free status, meaning dividends, interest, or capital gains could be subject to local taxes.

An exception to this would be countries that don't levy those kinds of taxes anyway. For example, in the UAE, there's no personal income tax on interest, dividends, or capital gains. This means your ISA investments wouldn’t face local tax, even though the wrapper itself isn't recognised. Similarly, in Monaco, there’s no personal income tax for residents (except French nationals).

At the other end of the scale is the United States. Like other countries, the US doesn’t acknowledge the ISA’s tax-free status and treats it as a standard taxable account. Worse still, many UK funds held within ISAs are classed as Passive Foreign Investment Companies (PFICs) under US tax law, which can trigger punitive annual reporting and tax treatment for US taxpayers.

If you’re planning a long-term move, it might make sense to adjust your portfolio or consider alternative structures better suited to your new tax home – such as life assurance wrappers in parts of Europe, or local tax-advantaged accounts where available. For example, France offers the Assurance Vie - a flexible investment account with major tax advantages if held for more than eight years.

Case study: Emma's ISA tax shock in Spain (fictional example, based on real tax rules)

Emma, a UK expat in Spain, assumed her ISA remained tax-free, but Spain doesn't recognise ISAs.

Dividends and interest were taxed at 19-26% under Spain's savings income tax.

Capital gains from her ISA investments faced the same rates.

Had Emma planned ahead, she could have used tax-efficient savings products, such as life assurance contracts, which offer tax deferral and other benefits for Spanish residents.

SIPPs: keep and still contribute (with limits)

As a non-UK resident, you can still pay into your SIPP, but the government will only give basic rate tax relief (20%) on contributions up to £2,880 per tax year. This means if you put in £2,880, the government adds £720, bringing the total to £3,600. Higher-rate tax relief is only available to UK residents.

However, this tax relief is only available for up to five tax years after leaving the UK. After that, you can still add money to your SIPP, but you won't get any government top-ups unless you have taxable income in the UK or become a UK resident again.

For UK residents, the deal is much better. You can contribute up to £60,000 gross per tax year (or 100% of your earnings, whichever is lower). However, for higher earners over £260,000, this allowance is reduced by £1 for every £2 over the threshold, down to a minimum of £10,000 for those earning £360,000 or more.

Wondering about UK inheritance tax for expats? Whether you'll still get your State pension? What happens to UK rental income? Check out our complete guide to managing UK investments when you live overseas.

Withdrawing from your SIPP

Once you hit 55 (rising to 57 from 2028), you can start withdrawing from your SIPP, but if you're living abroad, there are extra tax hurdles to consider.

You can take 25% tax-free in the UK, but your new country may not agree. Make sure you consult with a local financial advisor before taking any lump sum to avoid triggering shock tax bills.

The remaining 75% of your SIPP is taxable income, and you have three options: flexi-access drawdown (withdraw what you need while keeping the rest invested), Uncrystallised Funds Pension Lump Sum (take lump sums, each one partly tax-free), or an annuity (swap your pot for a guaranteed income).

A local expert can help you determine the most tax-efficient withdrawal approach.

Check whether a double taxation agreement (DTA) exists between the UK and your new country, as it may prevent you from being taxed twice.

Case study: Peter's pleasant pension surprise in Colombia (fictional example, based on real tax rules)

Peter, a UK expat in Colombia, braced himself for a hefty tax bill when withdrawing from his SIPP. But to his surprise, Colombia turned out to be far more generous than he expected.

While Colombia does tax foreign pensions, it exempts up to ~£7,500 per month. That meant his entire pension withdrawals were tax-free, as long as he stayed under that threshold. Even better, thanks to the UK-Colombia DTA, he didn't have to worry about being taxed twice.

Thinking longer-term? Consider local or international alternatives

Your UK SIPP can stay open, and you'll still benefit from tax-free growth inside it. But once your eligibility for UK tax relief ends, you may want to focus on a pension setup that's better aligned with your new tax home. That might mean opening a local pension, transferring to an international SIPP (more on that below), or just rethinking how you structure your retirement income altogether.

Where Brits are moving to – and what the pension options are

Hover over each highlighted country on the map below to see what share of British expats said they'd like to move to, based on the top ten most popular destinations.

Three countries top the list: Spain (sun and sangria), Australia (beaches and barbies), and Canada (mountains and maple syrup).

Source: Currencies Direct British Expat Report 2024. Participants could pick more than one country, which means the total adds up to more than 100%.

• In Spain, the closest option to a UK SIPP is an individual pension plan. There are different options on offer and contributions may offer some tax relief upfront, but retirement withdrawals are taxed as ordinary income under Spain’s progressive rates (19–47%)

• In Australia, it's possible – but not simple – to transfer into local superannuation funds. Only schemes that qualify as a QROPS (Recognised Overseas Pension Scheme) and meet HMRC conditions can accept transfers from UK pensions.

• In Canada, transferring your UK pension into a local RRSP (Registered Retirement Savings Plan) is possible in theory – but in practice, it's rare. Only a handful of Canadian schemes are HMRC-recognised QROPS, and even then, strict rules and tax hurdles mean most expats stick with their UK SIPP or consider an international option instead.

Read our guide: QROPS vs SIPP: which is best for expats?

But what is the international option?

International SIPPs are like regular SIPPs with a passport. Built for expats, they offer the same tax benefits but add features that make life abroad easier – like multi-currency investing, overseas withdrawals, and expat-friendly admin. If you’re retiring outside the UK and don’t want to be stuck with GBP income or clunky transfers to a local bank, they can be a good alternative. Just watch the fees – they’re often higher, so these are usually best for larger pension pots.

Of course, the choices you make will all depend on where you're moving to – be sure to check in with a local expert.

General Investment Accounts (GIAs): mind the capital gains trap

Not everything sits neatly inside an ISA or SIPP. If you hold shares, funds, or ETFs in a general investment account (GIA), the tax rules follow the same residency principles as your income.

If you’re UK resident, you’ll pay UK tax on any gains, whether they come from UK assets or overseas assets. That means selling shares in New York is treated the same way as selling them in London: both fall under UK capital gains tax.

If you’re non-resident: you normally only pay UK CGT on UK property and land. Other gains - such as from selling funds or shares - are outside the UK’s scope. However, your new country may tax those gains instead, depending on its local rules.

One important exception to this is if a share or fund derives 75% or more of its gross value from UK land. HMRC considers this an "indirect disposal" (e.g., you trying to swindle the tax man), and the gain will be taxed accordingly.

Another catch to watch out for is that if you leave the UK, sell assets while abroad, and then return within five tax years, HMRC can sometimes claw back tax on those gains as if you’d been here all along. This is designed to stop people “realising” big gains tax-free during a short stint abroad.

You might also face restrictions on further funds you're allowed to add to the account, and the types of trading you'll be able to do. It's always best to check in with your provider.

UK dividends are classed as “disregarded income” for non-residents. In practice, this means the UK doesn’t tax them at all, because unlike some countries, the UK doesn’t deduct any withholding tax from dividends before you receive them. But many countries tax residents on their worldwide income, so you’ll almost always need to declare UK dividends in your new country, even if the UK leaves them alone.

Case study: Sofia’s capital gains curveball in Spain (fictional example, based on real tax rules)

Sofia left the UK for Madrid, selling a chunk of her general investment account after moving. Because she was non-resident, the UK didn’t tax the gains.

But Spain had other ideas. Under Spanish tax rules, her gains were taxed at 23%.

To make things worse, Sofia moved back to the UK two years later. Because she returned within five full tax years, the temporary non-residence rule kicked in. HMRC clawed back tax on the same gains she’d already paid Spanish tax on. She could claim foreign tax credit relief to avoid full double taxation, but it meant a mountain of paperwork and zero chance of a sunny Spanish tax holiday.

How different countries treat GIA gains

• Spain and France tax residents on their worldwide capital gains, often at progressive rates that climb as high as 26-30%. Moving there and selling your portfolio soon after arrival could mean a heftier tax bill than if you’d sold them before you left. 
• The US taxes citizens and residents on worldwide gains regardless of where they live. Worse still, UK funds often fall under PFIC (Passive Foreign Investment Company) rules, creating punitive reporting and tax charges unless you restructure first.
• Australia taxes worldwide capital gains but gives certain discounts for assets held over 12 months. 
• Places with no capital gains tax (like the UAE, Singapore, or Monaco) can be attractive for expats looking to sell down a portfolio tax-free. But bear in mind, many of these places raise revenue in other ways - through high VAT, property taxes, stamp duties, or simply very high living costs.

ISA, SIPP and GIA tax treatment breakdown: UK Vs overseas

Product	While UK resident	After leaving UK	Tax abroad?
ISA	Contribute up to £20k/year, tax-free	Can keep open but no new contributions	Often taxed by local rules
SIPP (contributions)	Up to £60k/yr (earnings cap, taper applies)	£3,600/yr with tax relief, for 5 years	N/A
SIPP (withdrawals)	25% tax-free + rest taxed as income	Still taxed in the UK, but may also be taxed abroad	Depends on DTA
General Investment Accounts (GIAs)	CGT on worldwide gains + dividend/interest tax (UK rules)	Usually outside UK CGT except for UK property/land; temporary non-residence rules may claw back gains. Dividends likely fully taxable	Likely taxed locally; depends on country rules & any DTA

Bottom line

Moving abroad doesn't mean leaving your UK investments behind. But, rules change, and tax surprises await.

Your ISA stays open, but you can't make new contributions.

You can still contribute to your SIPP (although tax relief is limited), but withdrawals may be taxed abroad. That 25% UK tax-free lump sum when you turn 55 (rising to 57 from 2028) could trigger a massive tax bill in your new country.

General Investment Accounts (GIAs) fall outside UK capital gains tax once you’re non-resident - except for UK property or if you return within five tax years - but most countries will tax you on worldwide gains and dividends once you become resident there. Timing disposals and checking local tax rules before you move can save a lot of hassle (and tax).

Before you wave goodbye to HMRC, check you're definitely no longer a UK tax resident using the Statutory Residence Test (SRT).

Look into Double Taxation Agreements (DTAs) between your new base country and the UK, and consider getting local expert advice to avoid any nasty surprises.

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