Villas inside and out

There are places referred to as tax havens and these can be attractive for those retiring with large pension pots or dividend income.

Surprisingly, one of the most attractive places to retire (at the moment) is Cyprus because the Income Tax is a maximum of 30%, with pension income taxed at only 5%. With a Capital Gains Tax of 20% and no Inheritance Tax, it sounds perfect. But remember that what goes down can also go up and Cyprus is not known for its overall stability.

The conventional European tax havens of Andorra and Monaco remain popular due to their policy of zero personal Income Tax on both pension and other savings income. Rather strangely, Spain, Italy and Malta and even France offer taxation rates that appear to be advantageous when compared to the UK.

For those that like to live dangerously, South America, Malaysia and Thailand are potentially attractive.

The question really has to be, do you want to retire or do you want to run the gauntlet of fiscal policy making. Remember, there is no such thing as a free lunch.