Winds of Change for Expatriates in 2024
Subscribe to our newsletter for the latest expat news, views & analysis.
Welcome to the end of 2023 and the beginning of 2024.
We're looking forward to the year ahead and what the winds of change are bringing to our world.
Depending on what your view is, you could argue its quite an unstable world that we've got at the moment, and there's lots of changes that are afoot.
In this article I wanted to try and preview some of those, as well as anticipate what expats living and working abroad need to do to plan ahead for the things to do in 2024.
It starts straight away.
UK Elections
From the 1st of January, the UK introduced tax changes. These are quite unusual, but self-employed social insurance changes impact in the UK from the 1st of January. Now this is obviously a prelude to an election year in the UK, but anybody that's self-employed or expats working on a contract from their personal service company in the UK paying social insurance will get that reduction from the 1st of January.
So that's something to look forward to a happy new year.
With it being an election year, UK expats that are living and working abroad may consider whether they've got the right to vote in the next general election. They may not care, but if they do care and they want the right to vote, it's actually not, it's not all that it seems.
In the 2019 general election, the Tories have pledged to allow UK expats living abroad for more than 15 years to be reinstated to have the right to vote. Although they've agreed that in November in principle that they're going to do it, it's still not actually in force. But so if you're an expat, UK expat, you can register and vote as long as you've been outside the UK for less than 15 years. They changed the law as is proposed. Then even expats have been outside, as long as you're UK British citizen, you can register to vote even if you've been outside the UK for 15 years. So that's a potential change that could come in early in 2024.
The other big significant factor in 2024 is it's a leap year. So the 29th of February is a date to put in your diary and it allows the realignment of the sun, the moon and stars. But it can be bad luck for some people. And we need to plan ahead and anticipate that just because it's a leap year, it's not going to be a bad luck year for you. And that all your dreams can work out when you're living or working abroad in 2024.
In 2024, there could be a change the UK government. But actually, the last date that the current government could call the 2024 general election is the 17th of December 2024. So actually, the next UK election doesn't have to take place until the 25th of January 2025, the latest. So while everybody's anticipating 2024 being a general election year in the UK, it may or may not happen. But if it does happen, obviously it'll bring about big changes in terms of potentially the direction of the government and the way that is treated for people in the UK. If you, expats may or may not get a vote on that and they may or may not care, but certainly it would be a wind of change in the direction of the UK government going forward.
Trumps Trial
On the 4th of March 2024, Donald Trump is scheduled and slated for trial in the USA and potentially even in prison. Even if he's on trial, even if he gets put in prison for the incitement claims against him, he's still entitled to be a candidate and to be elected as president. So we could end up with an American president that's in prison when he gets elected. With the American election as well, we could also be going back to the 80s with potentially either Joe Biden or him being elected. Joe Biden has also got illegal challenges against him and so we're not even sure who would be the candidates to be the American president in 2024, bearing in mind that anybody who's born in the USA could be American so Boris Johnson who was born in New York City could become or put himself forward to be president in the United States.
Let's see what the new year brings.
Russian Elections
On the 17th of March, we've got a Russian general election. Now this could have a big impact into 2024 with a major instability in the world wars raging in the background, a bit like what was discussed in the novel 1984 where there was always a war going on somewhere in the world. People never quite knew where the war was and it never quite affected you on your doorstep. But with the Russian and the Ukraine conflict ongoing, it's not going to get resolved before the 17th of March.
And then we need to ask, will anybody stand against Vladimir Putin? And probably more likely is, will anybody vote against him? We will see, but certainly the Ukraine war and the conflict in Europe is not going to be resolved before the 17th of March. So it's something to look forward to, potentially a resolution at least after the 17th of March.
US Elections
The 5th of November could be a night that goes off with a bang. It's the date of the American presidential election in 2024 when, as we were saying, we could be going back to the 80s with Donald Trump or Joe Biden being re-elected and carrying on the current reign of presidency that's gone back over the last three terms, the last 12 years.
Or will America move on to the swinging 60s and get somebody from the previous generation and a new outlook? So we could have the same governments re-elected in the UK, America and Russia and have the same old world and the same old conflicts. Or we could have a new generation coming in, sweeping a new broom three. So let's see how it goes and consider what the world looks like at the end of 2024 with these major elections going on.
The Schengen Area
The Schengen zone is something we talked about quite a lot on the Living and Working Abroad show over the last year. In January 2024, there's a big change that's going on where potentially Bulgaria and Romania are going to be added into the Schengen zone as members. At the moment, there's four EU countries that are not members of the Schengen zone. Ireland, who are not intending to join, Romania, Bulgaria and Cyprus. Romania and Bulgaria were approved to join the Schengen zone in 2011, but objections from Netherlands and Austria have stopped their ascension into the zone for all these years.
The Spanish presidency in 2023 of the EU is determined to try and get a vote to allow Romania and Bulgaria to join in. At the time of this broadcast, the Netherlands and Austria had removed their objections so that vote could take place before Christmas and present the Romanians and Bulgarians with ascension into the EU Schengen zone for 2024. Remembering that the thing about the Schengen zone is that non-EU citizens are restricted to 90 days and 180 travel in any one country and includes people outside the Schengen zone.
So Romania and Bulgarians inside the Schengen zone will then have the freedom of movement throughout the EU that they currently don't have because of the Schengen zone. In 2024 as well, Cyprus is pressed to join the Schengen zone. Now it may or may not happen, but the EU could actually make a speedy decision for Cyprus. They've passed five of the six steps. Will it take another 10 years to approve Cyprus like they did with Romania and Bulgaria? We don't know. One of the main concerns with Cyprus at the moment is the Cyprus's golden visa scheme where people can buy citizenship for property investment.
So that could remain a long-standing objection to Cyprus ascension as could the Ireland status and that needs to be addressed. However, it would bring stability and harmony to the EU as it looked to control the EU Schengen zone. And so we will see if Cyprus succeeds in 2024 in getting its extension to the EU Schengen zone. Meanwhile, Cyprus citizens and residents will still potentially be subjected to the 90-day short stay rule in the Schengen zone. For more information and guidance on resident permits for the EU, contact us at www.partnership.com.
Electronic Travel Authorisation in the UK
In February 2024, the UK is expanding its electronic travel authorisation (ETA) scheme to include most Middle East countries. The UK introduced an electronic travel authority scheme similar to that of the USA (ESTA) in November 2023. And at the moment, only Qatar citizens are required to have the electronic travel authority before they travel into the UK.
When you get an ETA, it means you need to have that approved and authorised as part of your checking process for your airline, either online or in the airport. So from February it's been extended to other Middle East countries and then later in the year and in the next couple of years, all other countries, including EU citizens, will be required to have the electronic travel authority.
ETA’s are required for visa-free travel into a country. All people who have got visa-free travel into the UK will need ETA when it's introduced for their countries, which from February 2024 includes most Middle East countries.
ETIAS in the Schengen Area
The EU has been planning to introduce electronic travel authorities, called ETIAS, since 2022, but they deferred it in 2022, then 2023 and 2024 into May 2025 now for a number of different reasons. The site has technical reasons on the borders, but actually it's more to do probably with aligning the Schengen zone. And so Cyprus could well be accelerated into the Schengen zone in anticipation of ETIAS, which apply for the EU, but they're actually run under the auspices of the EU Schengen zone agreement, which is slightly different because it includes countries that are outside the EU. So the EU electronic travel authority could well accelerate Cyprus's accession to the Schengen zone in 2024. The other reason that's cited for the delay is a Paris Olympics.
The Paris Olympics is in July 2024 is going to be a major international event. And one of the reasons they've cited not having ETIAS introduced in 2024 is because potential snags and delays that could cause for people travelling around the world.
Easter
Easter is a funny time in 2024. The Catholic Easter is at the end of March, whereas the Orthodox Easter for Eastern Europe is a month later, the beginning of May, and that's a bigger gap as you can get. The Christian churches actually assign the date for Easter based upon a lunar month. So it's the first full moon after the equinox. And so the spring equinox is around about the 25th of March. And the first full moon after that date is the date of the Easter. However, the Orthodox and Christian church split.
The Roman Empire was split when Julius Caesar seized power with an emperor in Rome and an emperor in Constantinople, which is now in Istanbul. That then evolved into the Byzantine Empire. But in the 15th century, 16th century, the Roman pope changed the calendar from the Julius calendar introduced by Julius Caesar into Pope Gregory's version of the calendar, which is the one that's used in Western Europe today.
The Orthodox church still use the Julius calendar to determine the date to decide Easter. And that is why sometimes a lunar month is 28 days, a calendar month is 30, 31 days. And that's why sometimes there's a date difference between the Easter dates for the full moon for the Roman and the Orthodox churches. And in 2024, not only is it a leap year, but you've got the full month between the two Easters. And so the Christian Roman Easter is the end of March and the Orthodox Easter is the beginning of May.
More events in 2024
Another couple of events that are occurring that we're looking forward to in 2024 is in June, you've got the Euro 24s that have been held in football in Germany at the same time as the Copa America Cup in the USA. The other big sporting event of the summer is the Olympics. So it's a big summer of sport in 2024 with football competitions, major football competitions, the Euros in Germany, Copa America in the USA and the Olympics in Paris.
The biggest date in Cyprus next year is possibly the 8th of February when one of the world's top music stars Ed Sheeran is performing in Cyprus. So that's something for anybody with tickets in Cyprus to look forward to on the 8th of September. In March 24, any Cyprus sole trader or company that needs an audit needs to submit their tax return and their audited financial statements for the year of 2022.
In Cyprus, when you've got a financial statement that needs to be audited as a company or sole trader, you've got 15 months to produce that tax return and that becomes due at the end of the first quarter of 2024. If you need the audited statement which is due by the end of March 25, so you've got the whole of 24 to prepare your financial statement to the audit but not till March 25 does it need to be submitted.
If you need help and guidance completing your audit for your self-employed or company business in Cyprus for the year ending 31st December 2023 to be completed in 2024, contact us and we'll get going on that for you.
Cyprus Tax (Returns) For All
In Cyprus in 2023, Tax For All was introduced and it's got more than one meaning and at the end of 2023 and in 2024 for the first time, all Cyprus tax residents with any income at all, so anybody who's a Cyprus tax resident, got any income or any gains has to complete a tax return. So this ambiguous position they've had in the past where you only needed to make a declaration if your income was over 19,500 is gone and the reason for that is because even if you're earning less than 19,500 for income tax, you could still have flat rate taxes due on property rental income or on dividend income or on health tax and all those little taxes now will be collected up so everybody has to complete a tax return even if you've got a small earned income or no earned income because any income that you've got from rentals, dividends, shares or any other form of investment worldwide has got potentially even a small 2% amount of tax.
For more information guidance on that contact us.
UK Tax Returns Due
In January 24 as well by the end of the month tax returns need to be completed for UK expats up to the year 2022-23 so the UK tax year ends on the 5th of April each year so 5th of April 23 return is due by an online return by the 31st of January that's different to the October deadline for a paper return but have in mind that expats either have to do the paper return or an online return using private specialist online software you can't do an expat can't do an online return using HMRC website for because just because that is the rules and so Pro-Act are UK expat experts and if you need help and advice completing your 2023 return you've not started it yet contact us and we'll get cracking on that and get that finished off in January.
If you have got any balance of tax to pay for 2023 in the UK that will be due payable by the end of January as well and the other thing you need to declare on your UK tax return is any capital gains in the UK if you make any capital gains from property or investments they are reportable in a UK tax return and don't forget that if you selling any UK property you have to also do a capital gains tax return within 90 days of the original sale as well as at the end of the the tax year.
From April 24 there's a change in the way that people are taxed in the UK if you have got income from different sources from businesses or investments or personal service companies that end during the year up until now in the UK if you had a company that finished its business year at the end of October then you would report that income for up to the end of October as your income on your fifth of April return.
So the 5th of April was deemed to be the day that you earned all your income for the year even if the business year the investment or the company finished during the year. So that's changing from April 24 and over a couple of years there's going to be alignment so that in any tax year to the fifth of April in the UK from starting in 2024 but from 2026 it will declare your real income for the year. So if you've got a separate company income that finishes say in October you would declare the income from that company for the sixth month to October and then the income from the following year up to April so de facto your real earnings for the whole year or what you'd be declaring on the fifth of April.
For anybody that's got businesses and investments that are finishing during the year the prudent thing will be to start aligning those year end dates to the fifth of April because there's no advantage to to them being any other dates preparing separate sets of accounts at different times different situations for different people but to align your accounting your tax year ends and get your your tax simplified going forward for UK tax returns for expats living and working abroad contact us.
If you're a Cyprus tax resident a tax return for 2023 is made in 2024 and any balance of tax is due is paid after that return is submitted and by July 24. However that is not the whole situation if you've got worldwide earnings during the year as a Cyprus tax resident in 2024 you should consider if you need to make a self-assessed return in July or December each year you should make an estimation of your tax that's payable and in fact if you don't and you've underpaid tax by more than 25 percent then potentially you'll get penalties even if you pay the right amount of tax in the following July.
Self-assessment of tax liability by Cyprus tax residents is a requirement and responsibility and it's something that we carry out for our clients so if an expat living and working in Cyprus with overseas income that needs a self-assessment to declare that tax from overseas contact us.
There are 24 things to look out for in in 2024 and look forward to as a world of change politically a change in the way tax is assessed the way that tax is calculated and the way that business can operate across border changes to the residency regulations in the Schengen Area with electronic travel authorities all things that can impact access to your overseas property for longer stay at holidays and spring or autumn in the sun so if you need a help and guidance on obtaining a resident permit or a tax residency for the EU to enable you to have longer stays when you choose to and move around the EU with freedom or if your business is impacted with the tax or regulatory changes you can contact us and we'll give you help and guidance on sorting those issues out for UK expats living and working abroad in the EU and in Cyprus and around the world.
