Thursday, 29 June 2017
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Weekly Financial Update

Not really too much to report from the markets in the last week or so. Again, the Pound looked weak but in fact held up pretty well against the Euro and USD. Much press talk was about the Brexit negotiations going on in Brussels. Naturally we are going to hear many stories and assumptions regarding these, and the uncertainty can only add to volatility.

Brexit a year onIn the aftermath of the UK general election’s unexpected outcome, we reach the milestone of one year since Britain voted to leave the EU. What do we know today about how Brexit might affect expatriates in Portugal?

4801After losing the majority in Parliament, in an outcome she could hardly have imagined seven weeks earlier, when she surprised all by announcing an early election. May told the British Nation that she needed their backing to strengthen her position ahead of Brexit negotiations. Far from backing her, the British vote ended up with a far weaker premier, facing calls from furious Tories to sack her closest advisers and even to quit herself.

A year on from the Brexit referendum, Britain’s future place in Europe is once again an open question.

eurozoneThe UK general election has been the biggest news factor in the financial markets this past week. The result, although sold as unexpected, probably wasn’t that much of a surprise considering the way other elections have gone in the UK.

However, it naturally added to volatility in the market. The Pound had been steadily falling, so this event was expected to make it move lower.

UK Hung Parliament - What it meansIn another political shock, especially to pollsters' credibility, the Conservative Party have failed to secure an outright majority. However, assuming the 10 Democratic Unionist Party MPs side with the Conservatives, and Sein Fein do not take up their seats, the Tories should be able to form a Government.

There is plenty of rumour that Theresa May will have to step aside, but it is not clear who would succeed her – Amber Rudd only scraped by with a victory in her constituency. A leadership vacuum and a reduced mandate add new clouds of uncertainty to the economic landscape.

UK inheritance tax reformsThe UK tax year that started on 6th April introduced a new Residential Nil Rate Band for inheritance tax. Changes to the domicile regime were also meant to come into effect then, but these have now been put on hold until after the June General Election.

Liability to UK inheritance tax is based on domicile, not residence. If you are a UK domicile, or are deemed domiciled under HM Revenue & Customs rules, your worldwide estate above £325,000 is liable to tax at 40%. Assets in the UK are liable regardless of domicile.

Investing in Tough TimesDuring times of economic or market uncertainty, share prices will take a hit. Although it is likely to be uncomfortable, there is no need for investors to panic. In fact, these times can offer an opportunity to review your investment portfolio to ensure it is positioned to weather any "storms" that may lie ahead.

Paying for a Care Home in PortugalThere are roughly 60,000 Brits living in Portugal and of those, most pensioners are found in the coastal Algarve region. The popularity of the resort and the presence of a thriving expat community mean that English is spoken almost everywhere, making Portugal something close to a home from home, but with more sunshine.

However, unlike healthcare provision, the UK Government does not have any reciprocal arrangements to cover overseas residential care for Brits living abroad. A study by LaingBuisson found that the average cost of residential care in the UK is around £2,400 per month, with more specialist nursing care around £3,100. Costs in Portugal range from £2,200 to £4,400 per month.