Hong Kong British National Overseas (BNO) Passport
Nearly half a million Hong Kong residents have been granted a
British National Overseas (BNO) passport between 2019 and 2020.
The data from HM Passport Office showed that a total of
463,116 BNO passports were approved for issue in the two-year period, compared
with 68,915 during the three years prior.
Applications peaked in autumn and winter 2020 with an average
of 50,000 issued each month.
A BNO passport is a type of British nationality created in
1985 for people in Hong Kong before the 1997 handover to China, in order to keep
a link with the UK.
The status, however, does not grant the right to live and work
in the UK. But on 31 January 2021, the British government opened an additional
route under the BNO programme for passport holders and their families. They are
able to apply for a BNO visa which allows them to live, work and study in
Britain as well as provides a route to gaining full UK citizenship.
Since its introduction, nearly 65,000 applied for the visa
scheme, according to statistics from the Home Office.
Planning is paramount
Financial advisors based in Hong Kong have received more queries from clients
about offshore investing and relocating in the last 12 months.
The top three countries clients are looking to move to are the UK (91.7%),
Canada (50%), and Australia (41.7%).
The surge in BNO and relocation applications also came hand-in-hand with an
increase in enquiries from people seeking financial planning and advice
specifically related to moving to the UK.
Over the last two to three years, nearly half a million Hong Kong residents
have decided to renew or apply for a BNO passport or more recently apply for a
BNO visa with the hope of moving to the UK.
For anyone thinking of leaving Hong Kong, it is important to plan ahead
especially as the UK is a vastly complex and much higher tax jurisdiction.
Careful financial planning is a must to help mitigate significant tax
liabilities that also includes wealth held across the world.
For example, the UK’s highest income tax band rate is 45%, capital gains on
residential property are taxed at 28% and for other chargeable assets is 20%.
The UK also uses a different tax year and statutory residence test which can
both cause issues unless financial planning should start at least one year
before arriving in the UK.
There are planning opportunities to potentially mitigate tax exposure such
as holding wealth within a recognised insurance policy, but a comprehensive
wealth planning process including implementation of agreed plans take time and
therefore it is worth starting discussions with a financial adviser sooner
rather than later.
For BNO passport holders there are a couple of lenders who will consider
mortgage applications, both for residential and buy to let loans.
International Mortgage Plans
Mortgage Enquiry Form
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