Written by Emiley Phillips
Image by @ciara
Pack your bags…lets go. Dream job, abroad, offered. But. Wait. Before accepting and then rushing to the airport, there are just a few things you should think about.
Ultimately, are you sure you want to take the job? It all sounds exciting and a dreamy…a fresh start, but have you considered the practicalities? Here we will address the top things to consider before taking a job abroad. Strap in!
1) Exchange rate
Just like when you go on holiday, when going to a different country, there is an exchange rate to adhere to which will determine cost of living and expenses.
Putting this in a situation of moving abroad for work, this will not only impact your living costs whilst being there, but also any expenses that your company pays for. All will be relative to the country so don’t leave expecting for all to be the same!
2) Living conditions / lifestyle
Moving abroad is a major decision. Ok, you might have a job, with some income to get by, but you are leaving behind your family, friends and current lifestyle. Is it easy enough to visit when needed? How long is the new role for – what will the implications be of this?
Not to forget the fact that the living conditions of the country you are going to may be completely different. Of course, we do live in a globalised world now where trends and ways of life transcend continents, so there are similarities in lifestyle and living conditions, but there are still more than a handful of places where differences very much remain.
Have you considered that? Is the country you are going to a place with similar conditions? Or is it a totally new culture and way of living? Are you ready for that?
3) Tax implications
When moving abroad for work, you will still need to factor in tax. Depending on the employer and the country, the amount of tax deducted may vary. If you leave the UK to work in the EU or Switzerland, you will only pay into one country’s social security scheme at a time whereas if you leave to work in Iceland, Liechtenstein or Norway, you may need to pay into more than one country’s social security scheme at a time.
If going to work in a country outside of the EU, Iceland, Liechtenstein, Norway and Switzerland that the UK has a social security agreement with, your tax amount will be based on the social security contributions of that country instead of the UK national insurance contributions.
If working in any other country, you will continue to pay National Insurance for the first 52 weeks of being abroad if you have a place of business in the UK and if your original residency is in the UK. Working abroad and tax can be a headache worthy topic, but you can find guidance on the Gov.uk website here (note this only applies for UK residents).
When thinking about income tax, be aware that you will have to pay UK income tax on your foreign income – again dependent on if you fall into the ‘resident’ criteria in the UK for tax. If you do not fall into the criteria then UK tax will be exempt. Top tips here are to check the tax implications, do your research and know this before you accept your job offer.
4) Student loan
Moving overseas is not a get-out-of-paying-my-student-debt option! Unfortunately, there are no realistic options. You will carry your student debt over for 30 years after incurring it.
When you move abroad, you will still need to contribute to your repayments, even if your wage is lower. Ultimately the rules are that you pay 9% of your earnings above the local equivalent of £21,000 a year. The threshold of repayment varies based on the country you move to.
It is essential to note that when planning to move abroad for more than three months, you need to inform the student loans company (SLC) and complete an overseas income assessment form. From here, the SLC will arrange the repayments required accordingly. Failing to inform the SLC about your move abroad can lead to penalties.
5) Current bank account
Simply put, accepting a job abroad and moving away for work, does not mean you need to close your UK bank account. What you need to consider is how you plan to use that account. If using internationally, expect some restrictions to your accounts functionality (foreign IP addresses do not always go down too well!) and possibly higher transaction / foreign currency fees.
It is certainly worth checking with your bank too as some banks will not allow you to keep your account active whilst living elsewhere, alternatively, if there is inactivity then your account could be blocked. Benefits of keeping your current bank account involve making it easier to send money to family/friends from your home country, the ease of not needing to worry about opening up a new account when you return, and also reducing transaction fees if you need to pay bills in the home country.
So, you have just a few things here to consider before you get set and accept your new role abroad. Good luck!
In respect of the information above, this content is only for informational purposes and does not constitute any kind of financial advice.
