Abbey Wealth's free review explains how your EU retirement can be affected by Brexit and how to protect and secure your residency and finances abroad.
Abbey Wealth's free review explains how your EU retirement can be affected by Brexit and how to protect and secure your residency and finances abroad.
Each year, the Expatra team completes a review of the best places to retire abroad. They include European retirement hot spots both EU and non-EU (the Mediterranean, Adriatic and Black Sea countries as well as Central Europe), the Brits’ beloved Down Under and a few exotic locations, such as Thailand, Panama, Costa Rica and Malaysia.
Our new entries in our 2021 ranking:
As Greece is trying to entice foreign retirees with a 7 percent income tax, the country takes a deserved place in our top ten retirement destinations of the year.
Turkey is included for its climate, affordability, accessibility and inexpensive private healthcare.
North Cyprus has been ranked by Forbes as the top country for beachfront buys 2021. It’s the best value-for-money retirement destination of the year.
Inside the guide:-
Our review is based on the following criteria:
Note: When it comes to pensions, taxes and asset protection, the laws and rules are complicated. The information on taxes and pensions in this guide does not constitute financial advice and should not be taken as such. We highly recommend you obtain professional advice from a qualified tax planner and an international financial adviser.
Post-Brexit Britons are free to travel to any EU country and stay there for up to 90 days in a 180 day period without a visa. If you want to stay longer and settle down, you need to go through a residency application common for all non-EU citizens.
The procedure and the requirements are different from country to country and can take time and paperwork. In many cases, it’s worth consulting an immigration lawyer in the country where you want to take up residence.
Post-Brexit healthcare arrangements for retirees are similar to the ones we had before Brexit. You can still use your existing EHIC in the EU until it’s expired. After that, the UK will issue a replacement, the UK Global Health Insurance Card (GHIC). It’s still unclear whether it will work the same way as an EHIC used to.
An S1 form seems to continue to exist to help you get access to the same level of public healthcare as the local residents in your new country have.
North Cyprus offers a low cost of living and low property prices plus close proximity to an EU state – the Republic of Cyprus.
As a British citizen, you can cross the border freely to go shopping, use the airports or other facilities, or just for a day trip across the beautiful island of Cyprus.
A residence permit is required for Britons wishing to reside in North Cyprus.
A short-term residency is given on entering the country. It usually covers 30 or 90 days.
To apply for long term residency, the system is now automated and online.
If you want to stay for longer, you must apply (and meet the requirements) for a Temporary Residence permit.
The requirements are by far the easiest to meet: you have to own a property in the TRNC and show a monthly income equal to a minimum wage (3820tl per month, which is just under £400) or has the annual equivalent of this amount in a bank account.
Or you can rent and show an income equal to at least 3 times monthly minimum wages.
Temporary residence permits are generally issued for one year. However, if you are over 60, you might get a Residence Permit for 2 years.
On the whole, the cost of living in North Cyprus is around 50 percent lower than in the UK. You will pay 50 percent less for groceries. A three-course meal in a restaurant will cost you 38 percent less.
Rental costs in North Cyprus are 80 percent cheaper than in the UK. For example, you can rent a three-bedroom apartment in the centre of Kyrenia for £600. Or you can buy it for £830 per sq. m.
You will pay zero tax on your pension income in North Cyprus.
There’s no social security agreement between the UK and North Cyprus. Your UK state pension will be frozen at its current rate upon first payment, with no increases linked to inflation
All legal residents of North Cyprus are entitled to public healthcare.
The North Cyprus state health insurance will cost you around £45 per year. It covers the use of a State ambulance (112 Emergency Ambulance Service) and gives you a 20% discount on treatments.
Depending on your age and health, a private middle-tier healthcare plan with nil excess can cost you around £1,000 per year and will increase from the age of 55 upwards.
Pay-as-you-go option is also available and regular “maintenance” visits to a doctor won’t break your bank. As an example, a consultation with a GP can cost you £20-30.
Bulgaria is attractive to foreign retirees for obvious reasons: it’s cheap and it’s in Europe. Indeed, Bulgaria is an EU member, but it is not in the Eurozone, – and this keeps the cost of living low.
As a bonus, Bulgaria is a stunningly beautiful country that offers its residents all 4 seasons to enjoy in turn: lovely seaside in summer, great ski resorts in winter and amazing nature walks all year round.
Non-EU retirees should apply for a Bulgarian Pensioner D visa and temporary residence permit.
The set of documents for a long-term Pensioner D visa is submitted in person in the nearest Bulgarian embassy or consulate. After the Pensioner D visa is approved, the foreign national can apply for a residence permit. The residence permit for retired people is granted for a period of up to 12 months and it can be renewed annually.
You will need to present proof of your pension, address, health insurance and that you have a bank account in Bulgaria. To be considered financially independent, your monthly income should at least be equal to the national minimum wage per month.
Travelwise, Bulgaria is easily accessible from the UK, with an average flight taking just over 3 hours.
Learning at least some basic Bulgarian before moving would be very helpful. But don’t stop there. Knowing the language is necessary for functioning in the community no matter whether you will live in Sofia or in a province.
On average, Bulgaria is 54 percent cheaper than the UK. This includes housing.
As an example, renting a good two-bedroom apartment in a nice neighbourhood of Sofia will cost you around 700–800 BGN (Bulgarian Lev), which is about €350–400.
Outside of Sofia, rent, public transport and eating out will cost 50 percent less than in the capital.
Your pension and other incomes will be taxed in Bulgaria at a flat rate of 10 percent compared to the UK’s 20-45 percent. There is also a tax-free allowance of €4,050 per year.
There’s an option to transfer your UK pension abroad (to Malta or Gibraltar). The income from the transferred pension will still be taxed at 10 percent in Bulgaria. However, because you remove your pension from the UK, there will be no taxes on death, which may be up to 45 percent in the UK and no inheritance tax on your pension.
Warning! There’s no social security agreement between the UK and Bulgaria. Your UK state pension will be frozen at its current rate upon first payment, with no increases linked to inflation.
Healthcare in Bulgaria is universal and is financed from compulsory health insurance contributions.
To enrol in the Bulgarian healthcare system, you must first get your residency. You will be eligible to access state-funded healthcare based on your residency status.
To join the public healthcare system you will need your S1 form or, if you are not eligible for an S1 form, you will have to register with the National Health Insurance Fund and pay compulsory contributions. This will give you access to a GP, referrals to a specialist, and medicines at reduced prices or free.
It’s highly advisable to take out private health cover, as the standard of private health care tends to be much higher than that of the state system.
Private healthcare plans are expensive in comparison to the cost of contributions to state medical treatment but are still cheaper than fees in other countries. A basic plan from Uniqa for a couple under 70 years old will cost 330 BGN (€170) a year.
Turkey’s attraction as a retirement destination is its very low cost of living and of property.
In popular expat destinations English is widely spoken and help is available to expats with paperwork and other issues.
You can enter and stay in Turkey on a 90/180 day tourist visa.
A residence permit is required if you want to live there permanently. For the application you will need either a rental contract or title deeds, private health insurance (only for under 65), and proof of savings or income.
You will need to show that you can afford to live in Turkey, so your income should cover your rental bills and utility bills, the cost of living for you and your family members and the cost of your residence permit.
Another option is acquiring a Turkish passport. You can do it within 2 months, through property investments from $250,000.
The cost of living in Turkey is around 65 percent lower than in the UK. You will pay 58 percent less for groceries and a three-course meal in a restaurant will cost you 50 percent less.
Essential utilities will also cost you at least 60 percent less.
Rental costs in Turkey are 79 percent cheaper than in the UK. For example, renting a 3-bedroom apartment in the centre of Antalya will cost you around 2,200 TL (£230). You can buy a 100 sqm property in Antalya for £35,000.
You will pay zero tax on your pension income in Turkey.
After one year of residency, you can join the Turkish public healthcare system, Sosyal Güvenlik Kurumu (SGK), for a fee of 430 TL (around £50) for a couple.
Private health insurance from a local provider: a minimum health plan will cost you from 500 TL a month per person (£52).
When it comes to the Greek lifestyle, there are many aspects worth praising. Along with the glorious weather and amazing food, the pace of life is something many expats dream of in their retirement.
As with many European countries, Greece enjoys a relaxed way of life that might take some getting used to. Although major cities and tourist hubs generally work on a more global pattern of standardised hours, more rural areas often march to the beat of their own drum.
Foreign citizens can move to Greece to live permanently. EU citizens must apply for a residence permit after three months, but this is more of a formality.
Non-EU citizens including Britons must go through a more thorough immigration process which usually includes proof of your financial self-sufficiency and a host of other formalities such as health insurance, your local address, a health certificate from a Greek public hospital, etc. All documents should be in Greek.
However, there is a shortcut to residency in Greece, known as the Golden Visa programme. Simply put, you invest €250,000 in property in Greece and receive residency in 60 days. In this time you must also get a Greek tax number and Greek bank account.
Living in Greece is approximately 34 percent cheaper than in the UK including rent. However, the cost of living is definitely higher in cities, particularly ones with a lot of tourism.
Property prices, as always, depend on locations. For example, rent on an inner-city apartment in Greece will set you back about €335 (£300) compared to £760 (€842) in the UK, while rural rent on an apartment of the same size will be around €280 (£250) compared to £615 (€680) in the UK.
Food is generally less expensive as is eating out.
Utility bills are also lower in Greece.
Greece has introduced a retirement income tax of 7%.
To qualify, applicants must not have been a tax resident for at least 5 of the previous 6 financial years. Also, applicants must receive their pension from a country in a double taxation agreement with Greece.
Greece has a fairly good national healthcare system, which you can enter after three months of residency.
It looks like an S1 form will entitle you to state healthcare paid by the British government even after Brexit.
You can also opt for a local private health cover once your residency is confirmed. You can expect to pay upwards of €130 per person per year, but this will depend on your age and any existing health conditions.
Italy is gaining in popularity as a retirement destination with foreigners, including Britons. The idea of living in Sardinia or retiring to Tuscany is highly appealing to international retirees looking for their share of la dolce vita in retirement.
UK citizens can stay in Italy for up to 3 months. After that, just like any other non-EU citizens, they have to apply for a residency permit which is issued for a period of 5 years. Then you can apply for permanent residence.
Travelwise Italy is easily accessible from the UK. Budget airlines are cheap, and you can even take a train and travel from London to Italy in a single day if you prefer not to fly. Driving is also an option but you’d need to plan in an overnight stop.
Knowing Italian is pretty much a must if you want to navigate day-to-day life in Italy and truly make Italy your new home.
Popular retirement areas in Italy are not the cheapest places to live, but when it comes to housing, Britons on average do find it affordable. To buy a property in Tuscany, for example, will cost you on average €2,300 (£2,060) per square metre.
You might find that grocery shopping in Italy is slightly more expensive than in the UK. Eating out is about four percent more expensive than the EU average. Alcohol is cheap, and so is public transport.
Italy offers a great tax discount for expat retirees: if you retire to Italy, you will pay seven percent tax on your pension income for the first 9 years of residency.
However, after your nine-year tax-free residency expires, you are liable for income tax at Italian rates ranging from 23% on income up to €15,000 (£13,500) to 43% on income over €75,000.
There’s also an option of a non-dom tax, where you can pay a fixed fee instead of a tax on your world-wide income.
There is a QROPS solution available when you retire to Italy. You can use either a Gibraltar or Malta QROPS. If you use Malta your pension will be paid out gross with no tax deducted and 100% of your pension pot can be paid out as a lump sum to your family upon death.
Public healthcare in Italy is of good quality. If you are in receipt of the UK state pension and have an S1 form, you are free to use Italian public healthcare at the same level as any local person.
To be able to do this you will need to apply for a healthcare card – the tessera sanitaria. You will use it each time that you see the doctor, buy medicine in a pharmacy, books an examination in a laboratory, or visit a specialist in hospital and ASL (azienda sanitaria locale or local health unit).
If you are aged from 55 to about 65, you will find local private healthcare quite affordable. A basic private top-up plan for a couple can start from as low as €60 (£55) a month.
For many Britons, France sits high on the retirement abroad bucket list. It is within touching distance of the UK, yet so very different (and, many would argue, so much more appealing) on almost every level.
However, other nations also find France very attractive as a retirement destination.
Retiring to France couldn’t really be easier: it is right on our doorstep, and Britons can move there to live in retirement with minimal fuss. The country feels very familiar to most because of holidays and weekend trips over the years.
However, Brexit resulted in Britons losing their automatic rights to reside in the EU. So now as a UK citizen you have to go through a residency application as all non-EU citizens do.
The best way to go about it is to consult an immigration lawyer.
France is probably the easiest destination for Brits when it comes to travelling. Both ferry and plane take about 1.5 hours and a high-speed Eurostar takes you from London to Paris in under 2.5 hours.
However, there is a language barrier. Oui, they really do speak French in France… and will indicate that they prefer to be spoken to in French, too.
To integrate successfully in France, you do need to speak French. You won’t be sorry though, if you make the effort to learn the language, France will become a home you’ll love… It’s easy to access lessons online (check out the Duolingo app) or through the local library or the nearest college to you.
On average, France is just seven percent cheaper than the UK, so there’s no great gain here. It can also be expensive when it comes to buying a property, however, bargains can always be found, especially if you don’t mind a spot of DIY or engaging a builder to help make your home perfect.
In general, it all depends on your preferred location, much like UK prices vary depending on where you choose to live.
For example, renting a three-bedroom apartment in the centre of the popular retirement city of Toulouse will cost you about €1,090 (£980) a month. If you want to buy, you will pay about €3,640 (£3,270) per square metre.
And there are still some bargains to be had if you love rural France. You can buy an old house in need of renovation for about €55,000 (£50,000) or less, and turn it into your perfect pad in the sun.
If you retiree to France as an expat, you can take your pension pot in one lump sum and pay just 7.5 percent tax, with a 10-percent tax-free allowance. This will only work for lump sums: any regular income will be taxed at a higher level.
You can optimise your taxes by transferring your pension into a Qualifying Recognised Overseas Pension Scheme (QROPS) in a low-tax jurisdiction (for example Malta).
It won’t make much difference when it comes to French income taxes. It will, however, if done properly, protect your family assets from both French and UK inheritance taxes.
At first glance, France looks like a high-taxation country. However, with all the allowances, discounts and reductions available, a retired couple would not pay any income tax in 2019 if their net taxable income in 2018 had not gone over €27,974 (£25,000). Above that, it would be just 14 percent on up to €73,000 (£65,500).
That said, tax calculations are very complex in France; the above numbers are purely for illustration purposes. When it comes to your pension and tax liabilities, do seek professional advice.
An S1 form (certificate of entitlement to healthcare) should be still valid in one way or another after Brexit as retirees’ healthcare provisions were agreed in the Brexit deal.
The majority of your medical costs will be reimbursed through state insurance in France. You can usually expect a reimbursement in the region of 70 percent for visiting a doctor, dentist or specialist, around 80 percent of hospital costs and up to 100 percent of prescribed medications.
The rest of the medical fees have to be covered by the patient. If you are over 65, almost all of your costs will be reimbursed through state health insurance.
If you worry about the gap, you can choose to top up your health cover with a private health insurance policy, known as a mutuelle.
Most mutuelles will cover the remaining 30 percent of your general healthcare costs, including emergency hospital treatment.
The basic plan for a couple can start from as low as €80 (£72) per month; however, it does depend on your age and current health.
Mutuelles do not guarantee faster treatment or access to private doctors. They simply pay for what the national French healthcare insurance does not.
Another option is an international health insurance plan, but that will cost quite a bit. The most basic cover from the International Medical Group (IMG), for a couple aged between 60 and 65, starts from €840 (£750) a month.
In 2015 Malta topped the Telegraph’s list of the 10 best countries for Britons to retire abroad.
The fact that Malta is so popular with expats and retirees, especially Britons, doesn’t come as a surprise considering the country’s beautiful climate, its historic connections with the UK and its proximity to the continent.
As a former UK colony, Malta has a great sense of familiarity for Brits.
Maltese and English are both official languages and about 88 percent of the population speaks English. With three-pin plugs and even Arriva buses in Malta, it makes life much easier for British expats.
As a non-EU citizen, you have to apply for official permission to retire to Malta, which means jumping through immigration hoops. Hiring a lawyer can make the process easier.
Malta is easily accessible from any major British airport, be it London, Liverpool, Manchester, Birmingham, Nottingham or Cardiff. Flights are offered by a vast number of airlines including British Airways, Ryanair, Air Malta and EasyJet, which keeps prices competitive.
In general, it is less expensive to live in Malta compared to the UK. However, being an island, Malta has to import a lot of goods, making certain products more costly.
You won’t feel that there is a significant difference in rent or restaurant prices between Malta and the UK. But fresh farm produce in the markets can be more expensive in Malta.
Transport, petrol and basic utilities are cheaper, and so is alcohol – even imported.
When it comes to property, some sought-after areas can be expensive, however, they’ll still feel quite affordable compared to many regions in the UK.
You can buy a beautiful two-bedroom townhouse in one of the most expensive locations – Cospicua (the Grand Harbour) – for just under £300,000. A two-bedroom apartment in St Paul’s Bay (another popular, but not as upmarket, location) will cost around £140,000.
Malta offers expat retirees a favourable tax treatment under its Retirement Programme: they pay a flat rate of 15 percent on any income they remit to Malta.
Under the double taxation agreement, UK citizens residing in Malta have their pension taxed in Malta, not in the UK.
It means that your UK pension will be taxed in Malta at a rate of 15 percent, provided that you hold a Maltese Permanent Residence Permit.
You don’t have to remit all your pension income. So take what you need and, if you keep the rest out of the country, that pot won’t be taxed at all.
Malta’s public healthcare system is free at the point of delivery for all Maltese residents. With an S1 form, any British citizen who receives a UK state pension is entitled to the same level of public healthcare as locals.
As a retiree, you are also entitled to free treatment back in the UK if you so choose.
Public healthcare covers most medical services, including specialist treatment, hospitalisation, prescriptions and rehabilitation.
You can opt for private cover from a local provider; depending on your age and health, it will cost from €80 (£72) a month for a couple.
However, for those aged 65+, it can be difficult to get local cover and you will have to opt for an international insurer, which is costly.
Pay-as-you-go is an affordable option. A standard visit to the doctor might cost €10-15 (£9-14) and a specialist appointment not much more than €60 (£54). Hospitalisation, however, can make bills mount up fast. So it’s worth planning what you want to cover and what you can afford out-of-pocket when you choose a private plan.
Cyprus’ sunny weather, historical and cultural ties with the UK, as well as a lenient fiscal policy for expats, makes it a very attractive destination to retire.
As a former colony, Cyprus feels like home for Britons both culturally and language-wise. Greek and Turkish are the two official languages in Cyprus, but English is spoken all over the island. There’s really no need to learn the local languages unless you want to.
Brits are welcomed to the island and there are plenty of them, so you will never be short of homegrown company.
The residency requirements are the same as in the rest of the EU – you stay for 3 months, but after that you have to go through an immigration process.
Cyprus is a 4.5-hour flight away from the UK. Although there are cheap flights available, as an island, Cyprus is more restricted in terms of travelling than the other countries on our list.
Cyprus rocks when it comes to financial gains.
On average, the cost of living in Cyprus is 31 percent lower than in the UK. However, imported goods – including clothes and shoes and some fresh produce from the markets – are more expensive. A good reason to visit the UK occasionally.
The average property price per square metre in Cyprus is just under €1,700 (£1,530). The popular retirement destination of Paphos and other, smaller coastal spots are even cheaper.
For £300,000 you can buy a stunning three-bedroom villa in Coral Bay, Paphos, with a sea view and within walking distance of the beach.
If you are after a flat, £100,000 will buy you a three-bedroom apartment in a residential area of Paphos.
The Republic of Cyprus has a taxation treaty with the UK, under which British pensioners residing in Cyprus have their pension taxed in Cyprus, not the UK.
As a Cyprus tax resident you have two options:
The top rate in the tiered system is 30 percent, but an annual personal tax allowance is quite high, with the first €19,500 (£17,490) of income tax-free. So if your income is below or equal to a personal tax allowance, it makes sense to opt for the tiered system and live tax-free.
You can alternate between options 1 and 2 depending on which is better for you in a particular year.
You can also seek advice from an international financial advisor about transferring your pension into QROPS and potentially living tax-free. This will also offer protection for your family assets.
As a UK citizen in receipt of a state pension, you are entitled to obtain essential medical treatment in government hospitals in Cyprus with an S1 form.
If you don’t have an S1 form, pay-as-you-go is not very expensive. Visiting a doctor can cost from €30 – €50 (£27-45) and X-rays will cost approximately €50 (£45).
Private medical insurance can also be relatively inexpensive, although that is heavily dependent on age. Cypriot residents under 65 (whether Cypriot or not) can pay as little as €400 (£360) per year for private health cover.
Cyprus’ public healthcare works through the newly introduced National Health Scheme (Gesy).
Gesy is a universal healthcare system based on contributions from the residents. It is free to users (with small co-payments for certain services), subject to an annual cap, and covers both in-patient and out-patient care.
Retirees pay 2.65 percent in National Health Insurance System (NHIS) contributions on pensions, with tax capped on incomes above €180,000 (£161,440).
Healthcare benefits will cover a standardised basket of medical services, including hospitalisation, surgery, pharmaceuticals, general and specialist medical care and laboratory services.
In 2017, Portugal topped the Forbes’ list of the best countries to retire abroad. The country is a mix of everything we usually seek in retirement – a great lifestyle and healthy climate yet not a hinterland, good infrastructure, health services and plenty of activities – and it all comes at a reduced cost.
Just as in the rest of the EU, if you wish to retire to Portugal, you have to apply for a residency permit.
Portugal is well-connected. There are international airports all over the country: Lisbon, Faro and Porto have regular connections to major cities worldwide.
Lisbon is just 2.5 hours from Paris and London by plane. It only takes two hours to drive from Lisbon to Porto or Faro, and Madrid is just six hours away.
Portuguese is a difficult language to learn, though. If you live in more urban areas, where there are lots of expats, you will find English quite widely spoken. The Algarve, for example, is being anglicised rapidly thanks to international expats.
Living outside the Algarve means you do need to speak the lingo. If you advance your language skills beyond simple shopping terms, the rewards will be immense – you’ll gain respect, build local friendships more readily and are much more likely to be accepted as a full member of the local community.
Of our five top retirement destinations, Portugal is the cheapest. On average, life in Portugal is 34 percent cheaper than in the UK, including rent.
The same is true of property prices. However, unlike Spain and France (where expats’ favourite retirement destinations are scattered), in Portugal, they are mostly concentrated around Lisbon and the Algarve – the most expensive regions.
When it comes to property, the Algarve can look quite pricey compared to the rest of the country.
An average two-bedroom apartment on the Algarve coast costs at least two or three times as much as in central Lisbon or Porto. Still, £300,000 will buy you a wonderful three-bed villa in a gated community, with access to a swimming pool and a five-minute walk from the beach.
So, however expensive it is in the Algarve, it’s still very much affordable by UK standards.
The Portuguese government offers global retirees a 10-year exemption from income tax on foreign occupational pensions.
As long as a pensioner qualifies for a special expat pension tax regime for non-habitual residents, and the pension is an occupational pension, paid from a foreign source, the pension is not taxed in Portugal. If you apply for non-habitual regime after March 31, 2020, your pension income will be taxed at a flat rate of 10 percent.
When you retire to Portugal and become a non-habitual resident there, your pension will be taxable in Portugal according to the double taxation agreement (DTA) between the UK and Portugal. However, under Portugal’s non-habitual regime (NHR), for the first 10 years, Portugal will tax your pension at a flat rate of 10%.
The result is that Portugal is growing rapidly in popularity among retirees and the semi-retired from all around the world. The Algarve and other regions are filling with happily retired Scandinavians, Britons and other nationals appreciating everything the country so generously offers.
Portugal has a comprehensive free public healthcare system, ranked 12th in the world by the World Health Organisation.
If you are receiving a UK state pension, you can access the Portuguese public healthcare at the same level as the locals – you will need to obtain an S1 form.
Portuguese public healthcare system covers general and specialist care. Certain medicines are also available under the national health system at a discounted rate. For example, if you are over 65, you will pay just 10 percent of the prescription costs.
The coverage under public healthcare is pretty comprehensive. In addition to basic healthcare (general practitioners and specialists, maternity, hospital care, nursing care, prevention/ diagnosis, treatment and prosthetics), it also covers ophthalmology, dentistry, orthodontics and mental health.
It is a part-payment system, so most people must pay nominal fees (usually just a few euros) for GP visits and a little more for X-rays and scans. When you reach the age of 65, almost every service is free.
You are also entitled to free treatment in the UK.
Taking out private health cover in retirement is expensive, as not many local providers cater for 65+. For many, the only option will be international insurers.
As an example, a quick quote from Bupa Global Worldwide Health Options Plan (including dental and optical treatment, with zero deductibles) for a couple aged over 65 costs €2,700 (£2,420) a month.
Just like with any other country, there are good and bad points about living in Portugal, but on the whole, the country is rapidly becoming very popular with expats as a great value-for-money location.
Despite Brexit fears and economic concerns, our favourite European retirement destination maintains its appeal – thanks to its proximity to the UK, climate, lifestyle and sense of familiarity, Spain remains the firm favourite for Britons who retire abroad.
Britons wishing to move to Spain have to meet the same requirements as other non-EU citizens. So there is some paperwork to do to apply for a Spanish residency permit and go through the immigration procedures.
Spain is just a short flight from family and friends. On average it takes two to three hours to get almost anywhere in Spain and you can drive there too.
There is a big British expat community in Spain which means that, although you will definitely benefit from learning Spanish, there is no huge driver to become proficient or to learn it as soon as possible. There are enough English speakers around to manage your day-to-day life to start.
However, if you want to feel truly part of the community, you have to learn Spanish. Knowing Spanish will also help immensely if you use the Spanish national health service, as not many public Spanish doctors or nurses speak fluent English.
The cost of living in Spain is much lower than in the UK. On average, it will cost you 28 percent less to live in Spain than in the UK, including rent.
As an example, to rent a furnished apartment of 85 square metres in the most expensive area of Malaga (a hot spot for British retirees) – will cost you about €950 a month (£860).
If you are planning to buy your own home in Spain, the average price per square metre is about €4,978 (£4,470), even when expensive cities such as Madrid, Barcelona and Bilbao are thrown into the mix.
Our favourite Spanish retirement destinations tend to be a bit cheaper. If you are after an apartment in Malaga, for example, you will be looking at a price of around €2,750 (£2,470) per square metre in the centre.
When you become a tax resident in Spain, your pension income is taxed in Spain (not the UK) at Spanish income tax rates, under the double taxation agreement between Spain and the UK.
You can reduce your taxes considerably if your pension can be taxed in Spain as a purchased annuity. In this case, only part of the income is taxable, under certain conditions – which are quite complex.
As one example, in some cases, if you start drawing pension income qualifying as a purchased annuity between the ages of 60 and 65, 76 percent of it might be tax-free.
Another option is to transfer your pension to a QROPS (in either Gibraltar or Malta). There may also be additional benefits such as gaining access to a wider variety of investment options and a better inheritance planning.
Do remember to consult a tax professional and a qualified financial adviser when it comes to your pension, though.
The Spanish national health system is ranked seventh in the world by the World Health Organisation.
If you are a UK citizen receiving a UK state pension who has retired in Spain, you can use the Spanish system (the Sistema Nacional de Salud or SNS) and get the same treatment as locals.
For this, you will need an S1 form. Once you have registered it in Spain, you will also be entitled to return to the UK to receive free treatment if you prefer.
Spanish public healthcare is free at the point of use. If you have surgery, an overnight stay at a hospital or receive extensive prescriptions, you will be charged a reasonable fee. You may want to get a top-up plan to cover such expenses.
However, many expats choose to have private health cover to avoid long waiting periods and ensure that the specialists they see speak good English.
If you are looking for a private healthcare plan, the choice of local providers is ample. You will most certainly find something suitable for a reasonable price. As an example, Sanitas’ basic health plan for a retired couple starts from €138 (£124) a month.
Hopefully, the above list of our current top favourite places to retire abroad will give you some ideas and some new places to explore and research.
If you are considering retiring abroad, make sure that your planning covers every important aspect of your relocation such as your pension options, healthcare, how to make sure you are not taxed twice, removals, paperwork in your new country and so on.
It sounds like a lot of time-consuming work, that’s why we have done the research for you and put all the information together in our Retirement Abroad guides.
Abbey Wealth's free review explains how your EU retirement can be affected by Brexit and how to protect and secure your residency and finances abroad.