We were out in the sun today, basking in glorious hot weather, which I can tell you has been thin on the ground this spring. I don’t know whether to blame global warming or unpronounceable Icelandic volcanoes. It’s been miserably rainy, cold and grey here in the north of Italy – not so in the south. I know this as my Sicilian aunt keeps posting photos on Facebook of how hot it is down there to entice me to visit!
As a result the hillsides are looking particularly lush and green; while wisterias and irises have almost finished flowering, the air is heavy with the scent of jasmine. Everyone is now planting out their tomato, courgette and aubergine plants while we’re all sick of the sight of broad beans.
We’re all sick of the sight of kiwi fruit too. They grow fantastically well here in Liguria and they’re a very handy fruit in that one kiwi plant will produce tons of fruit in January, which keep very well – we’re eating our last ones now, five months on. Someone once told me that although they are a native plant of New Zealand, Italy is the number one exporter of kiwis, which doesn’t surprise me from the amount that grow wild around here.
As it is spring, I would like to welcome Kim Brown’s new baby, Sienna, and remind Kim that Italy is a great place to bring up kids! Here in my small town, the sight of a baby is a show-stopping, traffic-halting event. People positively revere children, especially babies. I was in a hurry to get home yesterday and a baby in a pram had created a bottleneck in the lane, as every woman in the vicinity had come out to worship it. And I couldn’t just walk past the crowd as I would have seemed crazy, so I had to stop and coo a suitable amount before slipping away unnoticed.
Kim will have to get used to the fact that every woman who stops to adore the baby will also offer advice on the baby’s clothing, ask personal questions about sleep patterns and breastfeeding and will volunteer their opinion on every aspect of child-rearing, therefore mothers as rule shouldn’t be in a hurry to get anywhere as all of that takes time. The first baptism I ever attended here was an event of Bollywoodian magnitude. I remember my partner saying we were invited to the party, and I asked him if he was sure I could come, as we had only just gotten together and perhaps the organisers weren’t expecting me. He couldn’t understand my question and later I understood why. The entire town was ‘invited’. In fact, in this town, you never receive an invitation to a baptism. It is understood that the whole town is invited, and pretty much the whole town turns up, which is why they’re held in the town square!
So what’s been in the news in Italy this month? Well, the UK’s election has drawn a lot of attention around here, as has the Greek economic collapse. The general economic crisis, which until now seemed to be somebody else’s problem, seems to be making more and more of an impact, particularly in manufacturing but we’ve also noticed it in the estate agency where I work. Things are still very quiet, which means there are a lot of properties to choose from at reasonable prices.
This month Lombardy’s TV channels have all gone digital and the analogue transmitters have been switched off. Here in Liguria we’ll still be analogue till the end of the year, but it makes little difference – from what I understand, digital Italian TV is just as bad as analogue Italian TV, there’s just more of it!
However, none of the news has made much of an impression on me as I have been basking in the glory of my new, low-emission wooden double glazed windows, installed exactly a month and a half after ordering. Finally I can report an efficient transaction undertaken in the time estimated!
This month’s feature – inspired by the Overseas Guides’ new addition to the ‘family’ – focuses on education in Italy. Just so Kim can plan ahead…
I remember, way back, when I was a university student in the UK and I was sent to Italy for my year abroad. I was still under 18 so I was asked to attend a high school, rather than a university. I enrolled at the D’Azeglio liceo classico high school in Turin… and was left stunned.
The children there were learning Greek, Latin, philosophy, history, history of art, English, French, as well as a smattering of sciences. Having come from a school system that taught three subjects to 16-18 year olds, I have to say I felt rather humbled by the experience, and ever since then I have been in awe of the Italian education system. Add to that the fact that their lessons finished at 1pm (though they did have school on Saturdays), and it seemed a winner to me.
If you are moving to Italy with children, you could do worse than place them in an Italian school. In my experience, it doesn’t take long for children to learn the language and get up to speed. In the long run, it spells complete integration for your children (who will become precious helpers for their still struggling parents!). However, if you aren’t planning to stay in Italy for long and you are living in a large city, you may want to opt for an international school where subjects are taught in English. The British Embassy in Rome’s website has a list of such schools: http://ukinitaly.fco.gov.uk/en/help-for-british-nationals/living-in-italy/education-in-italy
Here I offer my general guide to Italian education.
Kindergarten
Infant schools are open to all children, Italian and foreign, aged between three and five years of age. It lasts three years and is not obligatory. Infant school is regulated at 40 hours per week, which can be extended to 50 hours, while families can ask for a reduced attendance of 25 hours per week.
Primary school
Primary school is obligatory for all children, Italian and foreign, who have turned six. Primary school lasts five years. Hours can range from 24 to 27 hours a week, up to 30 hours a week. English is first taught at this stage.
Secondary school
‘First stage’ secondary school lasts three years and ends with a national exam, which needs to be passed in order to continue to the ‘second stage’. Secondary school is fixed at 30-36 hours per week.
The ‘second stage’ of secondary school is for children over 14 years-of-age who have passed the national exam. There are several different kinds of ‘second stage’ high schools that vary enormously in curriculum.
The liceo is what could be called the ‘premium’ high school, the kind that I attended in Turin all those years ago. The ‘classico’ has a curriculum that focuses on the classics (Latin and Greek), literature, philosophy and the arts, without however neglecting scientific subjects such as geography, chemistry, physics and mathematics.
The liceo scientifico is very much the same, though instead of teaching History of Art it adds Design to the curriculum.
The liceo linguistico is in essence a language school. The liceo artistico focuses on art, architecture and design.
Then there are technical institutes which focus on vocational training, such as surveying, accountancy, agricultural work and tourism-related professions.
And what do foreign kids think of all this? As 12-year-old Alessandra says: “It was really hard for me because I now have 15 different classes every single week: Arithmetic, Geometry, Science, History, Grammar, Literature, Epica (heroic poetry), Religion, Tecnica (draftsman-architecture), Geography, French, English, Art, Music, and don’t forget Physical Education. In California we only had 6 classes with the same schedule every single day. Italy is very complicated but we get more education.”
Please do give the OGC Resource Centre a call if you want to chat about this or any other Italy related concerns. They have services that they can recommend to you so please give them a call if you require help. These are people that we at the OGC have personally sourced and checked or companies that come highly recommended by other OGC readers. This is a free service and you are under no obligation to use them so why not give it a try – you have nothing to lose. The number is 0207 898 0549 or fill in our OGC Resource form at: http://www.ItalyBuyingGuide.com/resources.htm
The Election and how it has affected the Currency Market
The UK has just had one of the most hotly contested elections in living memory which, as expected, resulted in a hung Parliament [no one party having a clear majority]. Whilst we saw the pound gain initially as the new Conservative – Liberal Democrat coalition was announced, it has fallen even further and has hit a 13 month low against the US dollar as the reality of the situation facing the UK has hit home. With the election now firmly out of the way, what will drive the value of the pound over the next few months?
Sterling has come under attack in the last few months over political uncertainty related to the perceived ‘weakness’ that a hung parliament would bring. Why has this been a problem? The UK needs to match income to expenditure that means tax hikes and spending cuts in order to start paying down the biggest deficit since WW II. Neither the Conservatives nor the Liberal Democrats made it clear in their manifestos exactly how they would tackle the huge deficit. Sterling has weakened since the election as the government has promised £6bn of cuts in the next year and many are concerned – especially with poor housing figures released this week – that aggressive cuts will stifle out the fragile growth that we have seen so far since the credit crunch. Looking at the UK relative to the USA, where interest rates are expected to rise at some point later this year, the USA becomes a far more attractive investment than the potentially stagnant economy of the UK. Whilst the markets have embraced the new government’s stance on aggressively cutting the deficit, they are tentative over its implication.
The new chancellor George Osborne releases his first budget on June 22nd, in which he will outline where the cuts are to come from in order to attack the record deficit. For the pound to strengthen there needs to be a clear plan of action that the financial markets thinks is realistic and addresses the core problems and which the “ruling” parties can agree in order for any legislation to get passed. This may seem like too much to ask. Firstly, there are potentially deep ideological differences between the parties on how policy should be implemented and it is likely that the markets will be sceptical of any budget clearing plan – especially given the scale of cuts and savings required.
As it stands, the outlook for the pound is poor against the US, Australian and New Zealand dollar or South African rand as these economies seem likely to retain the relative upper hand over our own. There may be one light at the end of the tunnel for sterling – the Euro zone. With the Euro zone in the midst of a debt crisis, the pound could take advantage and strengthen. Could we see sterling hit €1.20/ £1 in the coming months? We will have to wait and see. The best thing to do is call in sooner rather than later and speak to a currency specialist to ensure that you avoid missing out on favourable rates and ensure that you don’t lose money by buying at a poor time.
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It’s often the people that wait until the last minute that are forced into buying at the worst times – don’t let that be you. Request a Quote from Smart Currency Exchange below or give a ring today to discuss your options!
A while ago I put together a short guide on QROPS or Qualifying Recognised Overseas Pension Scheme – you can still get a free copy of this by dropping an email to Italy@OverseasGuidesCompany.com and it will be forwarded to you.
I mentioned that it was announced in April 2006 that individuals with UK pension rights who have, or will, become non-resident in the UK for tax purposes could move their pension benefits out of the UK to a Qualifying Recognised Overseas Pension Scheme - QROPS. This could be seen as an International Pension or Offshore Pension and a QROPS can have significant tax and investment advantages for people who are no longer resident in the UK for tax purposes.
If you have been resident in the UK for tax purposes during the last 5 tax years then the QROPS rules should, for the most part, correspond to the rules governing an authorised UK pension scheme. After 5 years local rules can be adopted, which can be more flexible, for instance a transfer to a Guernsey QROPS would allow residential property investment, member loans and death benefits to be paid without tax deducted.
Now, as well as QROPS, there is QNUPS or Qualifying Non UK Pension Scheme. This is a qualifying non-UK pension scheme, established in February 2010 by a new UK HM Revenue & Customs (HMRC) statutory instrument. It is a perfectly legal trust structure for retirement and estate planning, approved by UK law, and it creates significant opportunities for British expatriates to save local taxes in the country in which they are tax resident as well as UK inheritance tax (IHT).
The main difference between QROPS and QNUPS is that QROPS is specifically designed for transfers from existing UK pension schemes, whereas transfers into QNUPS are from non-pension assets or investable wealth.
As long as the criteria for QNUPS are met then any payments into the scheme, or on the death of the pension holder, will be exempt from UK inheritance tax. QNUPS is particularly attractive to non-UK residents who want to mitigate local death taxes or potential wealth taxes in the country in which they are tax resident and UK IHT should they be UK domiciled, non-UK domiciled but may return to the UK at some future date or if they are simply unsure of whether they are non-UK domiciled or not.
As a pension scheme, a QNUPS is very tax efficient in most countries as it can avoid both local wealth taxes as well as succession taxes on your death. It also avoids local succession law.
QNUPS allows retired expatriates to continue to put money into a pension scheme:
Firstly, there is no maximum age at which you can invest in a QNUPS
Secondly, you do not need to have any earned income from an employment in order to make a contribution
Thirdly, there is no maximum contribution that can be made into a QNUPS.
The rules are sufficiently flexible to allow someone who is 85 years of age and has been retired for 25 years to put large investments into a QNUPS and immediately create significant tax advantages for themselves.
The benefits of QNUPS for retired British expatriates:
A QNUPS is a pension scheme trust and, as such, you are entitled to take a cash lump sum and income during your lifetime, with the remainder of your fund able to be passed to your spouse or heirs, free from all taxes, on your death.
The following advantages are available to you through a QNUPS:
As a pension scheme, a QNUPS is very tax efficient in most countries as it can avoid both local wealth taxes during your lifetime and succession taxes on your death
A QNUPS also avoids local succession law, so that you are free to choose exactly who inherits your money and in what percentage
Income can be taken from age 55 (after 6th April 2010) or it can be deferred as it does not need to be taken until age 75. In certain countries it can be paid in a manner where a significant portion can be paid to you tax free
When income is taken it is drawn down from the fund, thus leaving your scheme assets invested. Otherwise the assets grow free from tax
On death, the value of the QNUPS will be exempt from UK inheritance tax and local succession taxes
A QNUPS offers considerable investment flexibility and choice. Furthermore, your assets can be invested and any benefits taken in a currency of your choice, giving you the opportunity to remove the currency risk
The trustees of a QNUPS have no reporting obligations to HMRC unless the scheme also holds any assets transferred from an authorised UK pension scheme and therefore the problems of holding residential property in a pension are removed.
You can have both a QROPS and a QNUPS
QNUPS and UK inheritance tax
To repeat, a QNUPS will escape UK inheritance tax even if you a UK domicile. You do not have to wait seven years to avoid the tax or have to give the assets away, so you and your spouse/partner can continue to benefit from the assets.
When holding a QNUPS, it allows individuals to keep investing their money into the scheme after they have taken their lump sum, for as long as they wish to. This differs from a QROPS in that there, once you have taken the lump sum, you just receive an income from the fund that is left.
Any expat with a QNUPS can now leave the balance of any pension fund remaining on their death to their family or loved ones without fear of the UK taxman, regardless of residence and domicile.
The legislation lets UK expats or overseas nationals with UK pension rights invest in a pension scheme at any age with no top limit.
It also has benefits like no obligation to buy an annuity or alternatively secured pensions (ASP), no maximum contribution threshold and no requirement to have earned income from an employment.
A QNUPS also holds the flexible tax and investment benefits of other offshore pensions, like a QROPS. Investments and cash draw-downs can be made in a number of major currencies to hedge against exchange rate fluctuations.
A QNUPS can also be established in a stable, low tax jurisdiction regardless of where the pension member lives.
What’s the difference between QNUPS and QROPS?
A QNUPS has no Double Taxation Agreement between the UK and the country where the QNUPS is therefore it has no reporting requirements or obligations to HMRC
A QNUPS is a Qualifying Non UK Pension Scheme
A QROPS is required to report to HMRC for the first 5 years as per the Double Taxation Agreements in place
Existing QROPS can be transferred into a QNUPS as a more tax effective investment
As you can see, all this can be very complex. I have repeated myself above in order to give you a good broad outline of the scheme, but you really do need to get first class advice this that takes into account your personal situation and requirements and the very many issues raised.
The OGC Resource Centre has services that they can recommend to you so please give them a call if you require help. These are professionals that we at the OGC have personally sourced and checked or companies that come highly recommended by other OGC readers. This is a free service and you are under no obligation to use them so why not give it a try? You have nothing to lose – give them a call on 0207 898 0549 or fill in our OGC Resource form at: http://www.ItalyBuyingGuide.com/resources.htm
Are You Protected?
As an owner - or a potential owner - of a home overseas, you will already understand the importance of protecting your valuable asset.
Until now it has been hard to find an insurer who provides comprehensive protection combined with a flexibility that covers all eventualities. For instance, do you have the cover for legal liability for domestic employees – jad you even thought about this? And if you let the house out, what restrictions are in place, if any? Are the tenants covered – and are you if they should find fault with your house?
If your insurance policy has been placed through an insurance company abroad it is more likely that you simply do not know - but you can change all that!
The answer is a specialist in foreign property insurance that provides a plain English property insurance policy, underwritten by Lloyds of London and administered in the UK via helpful and knowledgeable staff.
I am delighted to tell you that we have found such an insurance provider that provides comprehensive cover against all eventualities for holiday homes in more than 40 countries. Whether your home is occupied or not, or let short term or long, their policies are ideal for property abroad - their product is flexible and designed to meet your specific needs.
Every policy offers a host of benefits, but one of the key advantages is the UK-based English speaking team that resolves any problems that may arise. In addition, all policy documentation is written in English, so you know exactly what you are getting.
Their cost effective policies provide far wider cover than most standard European policies. Add £5 million worth of essential public liability cover, which is important for anyone who lets their property - particularly with today’s trend toward litigation - and you have truly comprehensive cover at a very competitive price.
Don't risk turning you dream home into a nightmare by not having the right insurance cover - for more information please contact me at 0207 898 0549 and let’s have a chat. Or go to the link below and fill in the insurance resources form. I will phone you to discuss this very important aspect of your property abroad.
The media is filled with doom and gloom, but just because the economic outlook is a little on the gloomy side it does not mean you have to postpone your plans to either buy a second home or move abroad. On the contrary, it actually couldn’t be a better time to buy, providing you do your sums correctly, buy in the right place and use reliable, professional people to help you.
Let the Guides help you with all this – and more. Every step of the buying process is clearly and simply outlined, starting with the initial idea to buy all the way through to areas, how to buy land, investment options and many top tips. What is more, there’s a money-back guarantee if you don’t like the Guide so you have nothing to lose!!
The Guides are written by OGC staff members who know the country intimately and in many cases own their own homes there. They cover Cyprus, France, Greece, Portugal and Italy plus there is a wonderful Emigration Guide that would benefit anyone thinking of moving abroad on a permanent basis. The Guides are utterly honest and take a straightforward, no-nonsense approach to the property buying process and all the other aspects that such a move will raise.
This is what Eric and Mary White wrote:
I am sure it is through your efforts that many people who would have given up the idea of having a home or emigrating abroad have only succeeded by following the path through your Guides. Also your follow-up support has made it possible; I am just at the beginning of the long path but with your help I know we will end up living in our tranquil surroundings in our dream home,
For your continuing support Mary and I thank you,
Eric and Mary White
There are many steps that need to be thought out in advance, but with the help of the Guide you will succeed! Just order your copy now at http://www.ItalyBuyingGuide.com/guide.htm. You are also welcome to phone the OGC Resource Centre where you will find a team of friendly and helpful people happy to assist with your queries. The number is 0207 898 0549.
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Well…we have simply masses of feedback from people who have already used our services, so here are what a couple of people had to say:
“…Let me say how happy Philip and I are with your [OGC Resource Centre] service. You have opened so many doors for us….I like to take things one step at a time, to fully take on board every situation, but I could never have been prepared for the multitude of options that you have presented us with. …You can be sure that we will be using your recommendations because we are gaining more and more confidence in your company and that is all down to the interest you take and the advice you give.”
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"Having found the forum, subscribed to the free newsletters & purchased the Guide to purchasing property, it was amazingly easy using the tips & suggestions, to define my requirements & establish my strategy for what I really wanted.
Then once introduced to the Guides Company's network of friendly, helpful associates, everything fell into place. And this despite some very attractive, but potentially risky, alternatives which I could have easily tempted into. However, I had a plan to keep me on track & knowledgeable friends to draw advice from. I have now successfully purchased a unique property, which I believe I will enjoy during my future retirement in a friendly to you, your colleagues & all your kind associates & their unique way of working. Best regards, Brian Dorey."
Just pick up the phone at 0207 898 0549 and the OGC Resource Team will be happy to help you. The team is available Mon-Fri from 9am to 6pm. You are under no obligation to use any of the recommendations and this service is absolutely free at the moment, so give them a ring today or fill in our OGC Resource form at: http://www.ItalyBuyingGuide.com/resources.htm
Ciao for now!
That’s it for this month. I hope we will see you in Italy over the summer. Until then, have a great month and please let me know if there is any way we at the OGC Resource Centre can help with your plans to buy in Italy. Now is the time – prices will seldom be any better than they are at the moment.
