Returning to the UK from a stint in another country can be stressful, with lots of things to consider. Whether you are coming back as part of a retirement plan, making a career move or looking to reconnect with family, you’ll need to consider your finances and how you can transfer any funds safely, securely and at a low cost.
Below, we’ve answered some of the key questions you need to consider when returning to the UK, as well as how you can compare money transfer providers to ensure you can bring back your money quickly and at the best possible price.
Am I allowed to return to the UK from abroad?
All British citizens have the right of abode in the UK, meaning that you are entitled to live and work in the UK without any immigration restrictions.
The government has established guidance for UK nationals living abroad, including the actions you must take in order to return to the UK.
For example, if you are returning from Spain, you would need to deregister from the municipal register, and you may need to inform your local foreigners office and health centre that you are leaving. Additionally, if the NHS currently funds your healthcare in the country, you would need to contact the NHS Overseas Healthcare team to cancel it.
Will I have to pay UK tax on income earned abroad?
Whether you are taxed on foreign income earned from abroad will depend on your UK tax resident status. If you are a UK tax resident you will in most cases need to pay UK tax on income earned abroad. This spans foreign salaries, rental income, investments and pensions.
You become a UK tax resident if:
- You spend 183 or more days in the UK during the tax year (6 April to 5 April the following year).
- Your only home was in the UK for 91 days or more in a row – and you have stayed in it for at least 30 days of the tax year.
- You worked full-time in the UK for any period of 365 days and at least one day of that period was in the tax year you are checking.
If you return to the UK within five years of moving abroad (or five full tax years if you left the UK before 6 April 2013), you may need to pay taxes on certain incomes or gains made while you were not a resident – this does not include wages or other employment income. This also applies if you were a UK resident in at least four of the seven tax years before you moved abroad.
Do I need to inform HMRC about my return to the UK?
When returning to the UK, you’ll need to notify the HMRC of your return to update your tax status.
You may need to register for self assessment e.g. if you start working for yourself or have other income or gains from the UK or abroad. You don’t need to register if you’re an employee and don’t have other untaxed income to report.
What happens to my National Insurance contributions?
If you start working again in the UK, you’ll usually start making National Insurance contributions again too.
If you didn’t pay NI while abroad, you’ll be able to check your NI record through the UK government website to see how your state pension might be affected.
Are there limits on how much money I can transfer back to the UK?
There is no legal limit on the amount of money you can transfer back to the UK after returning. However, if you are carrying £10,000 or more in cash, bearer bonds or cheques, this must be declared to UK customs.
Depending on the payment method you are using, there may also be limits on transfer amounts, with these tending to be between £10,000 and £100,000 for major banks in the UK. For some specialists, these transfer limits can be much higher.
Do I need to declare large transfers?
You do not need to declare large transfers. However, your bank may be required to report suspicious activity or large, unusual transactions to authorities, and may ask you for proof of source of funds.
Your bank or money transfer provider may also collect certain details about the sender and the recipient.
Official bodies such as the Financial Conduct Authority and HMRC may monitor incoming transfers from abroad to confirm they are not the result of fraud or money laundering.
How might exchange rates affect my income transferred from abroad?
When transferring large sums of money back to the UK, exchange rates may fluctuate and impact the amount that is sent. This is why it’s always important to compare money transfer providers in order to get the best possible price.
Will I be taxed on money I transfer from overseas accounts?
When sending existing funds to yourself in the UK, there are no taxes that will need to be paid when transferring the funds. However, depending on the amount being transferred you may need to pay fees to your bank or money transfer provider to facilitate the transfer and exchange it into GBP if necessary.
However, if the money being paid into your account comes from a wage or a salary then you will likely be taxed on this under the UK’s rules for foreign income. You also may need to pay income tax on foreign investment income (e.g. from dividends and savings interest), rental income on overseas property or income from pensions held overseas.
Compare money transfer providers
Specialist money transfer providers can help you repatriate funds from overseas and assist in specific use cases. Compare money transfer pricing across well-known providers using FXcompared’s comparison tool, or read our other guide for key things to consider for returning expats here.
