Brits with holiday homes across EU are at risk from Brexit

by Joel Baccas | 04.07.2018

There has been lots of talk about how Brexit will hit Brits living in other EU countries, but what about people who live in the UK but own property on the continent?

Plenty of Brits have bought holiday homes across the other 27 EU states, both for their own use and to rent out to other holidaymakers. They benefit hugely from EU membership, which makes it much easier to buy properties abroad and protects them from local laws which may affect them adversely.

Nationals from non-EU “third countries”, like the US or China, don’t get the same automatic protection under EU law.

Citizens of all EU countries must be treated equally across the bloc. That means a national from an EU member state who buys property in another EU member state can expect the same legal treatment as the citizens of that country. They have legal rights to complain to the national courts of the member state, as well as to the European Commission and the European Court of Justice (ECJ).

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This was shown in a case at the ECJ concerning a Dutch national, Gerard de Ruyter, who worked for a Dutch company and paid social contributions in the Netherlands but was resident in France.

In 2012, the French government introduced a new tax that meant De Ruyter had to pay social contributions in France, despite already doing so in the Netherlands. But EU law prohibits a member state from imposing social security contributions (e.g. national insurance) on rental income on an EU citizen when that individual is already paying social contributions to his or her own member state (see Article 13).

The ECJ found in favour of De Ruyter and France’s highest court, the Conseil d’État, confirmed the decision. This resulted in France having to refund the people who had suffered the charge.

If Theresa May sticks to her Brexit red lines – leave the single market, end free movement, end the jurisdiction of the ECJ – then the UK will become a third country on March 29 2019. UK citizens owning property abroad will be exposed to local laws without protection from the EU. It’s just another one of those little-known benefits of EU membership that will disappear after Brexit.

Edited by Luke Lythgoe

16 Responses to “Brits with holiday homes across EU are at risk from Brexit”

  • “There has been lots of talk about how Brexit will hit Brits living in other EU countries, ” Really!!!!! I am a UK citizen in Spain, yes there is a LOT of talk about what will happen to EU citizens in the UK … But as for UK citizens in the EU , we are as in the dark today as we were on June the 24th 2016 . Nobody is telling us anything .

  • Good point. They will also most likely have to buy expensive private health insurance top cover each trip, and those who are used to spending more than three months at a time in their EU holiday homes won’t be able to any more.

  • The legal implications for UK citizens in Europe post-Brexit are much wider than what the author is listing. Also, they go well beyond financial loss. Happy to contribute in the normal way through a commission if interested.

  • What can anyone actually tell you? Seriously, with the best will in the world, no-one knows and even less can claim to know what the final outcome will be. If your principal residence is in Spain, you may well have an interest in establishing your legal domicile there, for all sorts of reasons, not least continuing access to healthcare. There are specialists who can tell you what some of the likely implications of that decision may be, but there will remain considerable areas of uncertainty, including the fate of any U.K. state pension you are entitled to, and whether that will be index-linked in future. In the event the U.K. crashes out without an agreement, you and many hundreds of thousands of other U.K. nationals living in the rest of the EU, and several million other EU nationals living in the U.K. will be confronted with a whole series of major uncertainties – making today’s uncertain picture look like a fairy tale.

    Whilst we know what the EU wants to achieve, the same cannot be said of the U.K. Government. It is one (big) part of the tragedy that is Brexit.

  • This is a bit out of date. France swiftly got out of that ruling by allocating the social charges to a different, non healthcare related fund – so non residents have to pay social charges on French capital income now.

    What is more relevant to British holiday home owners is the fact that as third country nationals they will be restricted in visiting their holiday homes to 90 days out of each 180 – so no more nipping back at the 90 day point (if they bothered to keep within EU rules on that) and coming back a couple of weeks later. The ETIAS system will apply and will monitor how long people stay and whether they exceed the limit.

  • Completly agree with the points above about uncertainty about pensions and reciprocal healthcare even though David Davis gave cast-iron guarentees for expats regarding these. But then he adds the line, ‘nothing’s agreed until everythings agreed’, so make of that what you will. I know what I make of it.

    On owning holiday or permanent homes there’s another point to consider.
    Getting a mortgage is likely to be problematical. Whether from a UK or EU lender.
    One major lender in Germany told me outright that a mortgage for a non-EU citizen, including Americans, would be a non-starter. Added to that you have the complication of transferring money within Europe. At the moment the UK is part of SEPA (Single European Payments Area). It facilitates the easy transfer within Europe. No doubt you will still be able to transfer money outside of SEPA, but something tells me it’s not going to be any cheaper.
    All points that Brexiteers probably have never thought about, like so many other things.

  • I agree with all the above. I am a person currently resident in th UK who purchased a house in Brittany pre referendum with the intention of moving to France after I received my pensions in two years time. I consider I am well and truly caught between a rock and a hard place with all the Brexit uncertainty .

  • There’s another likely problem – many Brits with holiday homes rent them. As third country nationals they’ll be faced with paying higher taxes on these transactions along with other discriminatory measures and restrictions. There are going to be many nasty surprises in store for a lot of people, I can hear the chorus now, “We didn’t vote for this!!!”.

    The Tories are betraying Gibraltar. Respect the wishes of the 96%. No to colonialism! No to Fat Boris!

  • This is what has worried me since the referendum. Apart from a few folks here, no one seems to be grasping this. I have a winter holiday home. At present no one can stop me going there as I am an EU citizen. Once ETIAS comes in, if I am subject to it, I can only visit for 90 days in 180 day period. That might sound ok. However, if I spend most of the summer with friends in Spain and then want to use my winter retreat, I won’t be aloud. Also ETIAS does not give a right of entry, the boarder guard can stop me, at his or her discretion. This is a real worry as sometimes border guards get it wrong. I don’t know how many other Brits have holiday homes in an EU country but we are under very real threat. Everyone is talking about the rights of expats and tourists but we are neither. Another problem is the re issue of ETIAS. I am a very law abiding citizen, but was surprised when told that even a motoring offence is a crime. Who knows what crime may prevent re-issue of ETIAS? I do not feel comfortable owning a property where I need someones’ permission to go there, while any EU national does have the right. The EU allows many people freely into Europe who claim to be asylum seekers or economic migrants, and allows them to stay permanently, but having invested my money in an EU country ( thus creating work in that area ) they want to limit my access and rights. Like many other aspects of Brexit, we are only now finding out the very dark truth, that separating from the EU is like separating black paint from white after its been mixed for 40 years. I believe the best possible outcome for holiday home owners is some sort of purchased EU associate citizenship, which essentially restores our rights. I just want freedom to use my holiday home, get emergency health care, but if I need to I’ll get on the first plane back home for serious health issues. I don’t want welfare or anything else, just my freedom. How difficult is that? I fear it won’t happen if we don’t do something to make it happen.

  • Totally agree.Many second homers want to spend their max 180 days away from UK but the new restriction is going to be a suprise to many -especially as they are paying tax foncier and habitation. Or equivalent where their second home is . Suggest second home owners all write to their MP and MEP and also start a crowd funded publicity campaign to raise awareness

  • How undemocratic of you to denigrate the victorious majority who pulled off a landslide majority in 2016.
    Sour grape syndrome?

  • Surely no-one can call a 52% to 48% is a landslide majority, I am not surprised that you said that as from Day 1 from after the Referendum politicians and some broadcasters said that the majority was huge – it was not. Also a minimum of people knew what they were voting for as in the UK this had not been made clear by government or media alike. We live in Germany a lot of the time and far more information was available in Germany than in England. A second referendum is essential.

  • I’m rather confused re the 90 day per 180 day restriction. Let’s assume that I want to spend May, June and July abroad and then August in the UK, I could again go to France for September and October. November is spent again in the UK but December in Germany. Is this how it works? It would still allow 2 x 90 days per year in the EU. OK, not all in one piece but the time period is the same. Have I totally misunderstood that?
    Re health insurance: We asked a broker in Germany and he found that Allianz (also available in France) would insure us comprehensively, including pre-existing conditions, for €52 per week for the two of us. This does no seem excessive. However, we still all hope that some deal can be reached which will not put us into the category of 3rd country nationals. In particular freedom of movement. Here’s hoping.
    Any advance on my interpretation of the 90 day restriction? I may have to hang my head in shame.

  • 90 days in 180 means that If you stay abroad in May, June and part of July (don’t exceed the 90 days), you couldn’t go out again until the end of October or November. That’s because you will have used your 90 days within the previous 180.

    I have family (and an apartment), in Italy and was hoping to spend a lot more time there to see the grandchildren (following retirement), and this is definately going to impact me. Also, I will still have to pay annual taxes (maybe at a higher rate), even though I won’t be allowed to use the apartment – A losing situation in every respect.

    I do have another concerrn that I don’t have clarity on – I also spend a week or two in Austria and go skiing every year, usually either France or Italy, and I’m guessing that these additional visits will add to my 90 days in Europe. Is this correct or is the restriction 90 days in each country?

  • My mother was Austrian and my husband and I brought a house 7 years ago in Austria. We go out every summer and a few weeks in Winter. Currently with no problems. I really do not understand all what is going to happen with Brexit at all and am frightened as to what I should do regarding the house in Austria. I am a UK resident and a UK citizen. Does any one have any advice where I should start to get some information from. Any links you are aware of would be greatly appreciated.

  • Well things have moved on since the last comment. Brexit could well mean the end of my holiday home. It’s all down to health insurance. Insurance companies take no risks and wriggle if you do not have adequate cover. At present my holiday insurance is tied in with EHIC. If we lose EHIC you can expect your holiday insurance to be similar to say the USA. If you wish to occasionally engage in sport when in your holiday home, you will need full cover for that activity for the entire duration of your stay. This is where it all gets problematic. I own a property in Finland, where it’s pretty flat. ( Some locals go to Norway to ski as its more exciting ). Like the locals I nip through the forest on skis in between the cross country ski tracks and around the fells generally. This in the eyes of insurers is off piste skiing, when in reality it’s going for a walk in the woods with skis on your feet. However I need to be covered, so I pay the same fee as someone who is launching themselves off a steep remote mountain. ( take a look at back country skiers on you -tube…..definitely not me.) I pay cover for everyday I am out of the UK, even though I only ski half a day in 2 days.I pay a higher premium because I want to go without a guide .( I know the area really well, I’ve been in the same area for 13 years now, and am friends with local guides and mountain rescue, so listen to them ) It gets worse. Ski cover of this type will only extend to 30 days, so if I go for 60 days , I need to fly back to the UK for a while. I am 60 and as I get older the premium goes up. All this has been ok so far because we have EHIC, which reduces the premium to a manageable level.I am in good health but a small health issue would also effect this. So what started with me wondering around a Finnish forest with skis on my feet 13 years ago, safe in the knowledge that if I hurt myself I can get free emergency health care and fly home when fit enough to do so, now means I may need costly expedition style ski insurance for a third country. The simple fact is there is no insurance for holiday home owners who play sport in that area at a low level.