Many in the UK are rethinking retirement plans for moving abroad. Their decisions are less focused on how any one country is dealing with the virus and much more on the uncertain shadow cast by Brexit.

A recent poll from Canada Life suggests that almost half of over 50s who plan to retire abroad are reconsidering because of Brexit.

With countries being graded on their response to the virus and the potential for second spikes, the idea of foreign travel, much less retirement planning, has been thrown a giant loop in recent months.

Research from Canada Life shows that Brexit is still the dominant factor behind international retirement plans. Almost half (46 per cent) of over 50s planning a move on retirement are reconsidering where that might be; and almost as many say the uncertainty of the UK’s exit from Europe is making them reconsider plans altogether.

The investment firm polled 1,000 UK adults aged 50+ between 6 to 13 July 2020 and just a third put COVID concerns above Brexit.

Retiring abroad has long been popular among Britons wanting better weather (68 per cent), a more desirable lifestyle (63 per cent), higher standard of living (46 per cent) and cheaper living costs (45 per cent). The latest data from the Office for National Statistics puts the number of Brits who have retired in EU countries at 784,900.

Spain has topped the retirement list by some measure for the last eight years and, in spite of the current travel upheavals due to the virus, the top ten locations have not changed from last year, with both New Zealand and the Far East gaining popularity, according to Canada Life data.

The investment house, a subsidiary of Toronto-listed Great-West Lifeco, reported that the average monthly income needed to retire abroad is £1,404 -- £378 less than the UK. Outgoings differ by country, but those hoping to retire in France need roughly £1,562 a month, followed by Italy at £1,541. UK retirees need an average income of £1,782 a month, increasing to £2,201 for those who live in London.

Although a reciprocal social security agreement is an important factor, the firm’s research found that just a quarter of those planning to move understood which countries had reciprocal payment agreements in place, and a fifth didn’t know such agreements existed.

Many countries, including those in the EU, have such agreements with the UK, which means that the state pension will increase each year just as it would for retirees living in the UK. The question is whether these arrangements stay in place.

“It’s surprising that Brexit concerns come out on top and could indicate that longer-term legislative fears are greater than shorter-term health and safety for soon-to-be retirees,” Andrew Tully, technical director at Canada Life said.

Key is knowing which countries offer reciprocal payment agreements, currency exchange rates, and whether state pensions will keep pace with the cost of any living increases, he added.

For those planning to retire abroad, the firm suggests the following checklist:

* Get an estimate of your state pension and seek financial advice.

* Tell HMRC that you are moving overseas. This allows them to let you know of any UK tax liability you may have even though you are planning to live overseas. More importantly, it can allow any of your UK pension to be paid gross (no tax deducted) and taxed in your country of residence. (This only applies if the country you live in has a double taxation agreement with the UK.)

* Check what reciprocal social security agreements are in place with the destination country regarding your UK state pension, including whether it will be increased or frozen, and other benefits.

* Find out about your welfare rights while abroad. Keep an eye on exchange rates as state pension and other income is likely to be paid to you in sterling and you will  need to convert to the local currency which may mean a fluctuating income.

* Check the cost of healthcare in the country you are thinking of moving to, and consider some form of medical insurance.

* If you decide to keep your property in the UK you will need to let your mortgage provider and insurance company know if it will be rented or remain empty.

* Do your homework on the cost of living in the country you want to move to.

* Notify utility companies, financial institutions and your local council when you are leaving.

* Contact the electoral register, and arrange for mail forwarding via the Post Office.

* If you plan to keep an account at your UK bank, contact your bank and ask if you will face any new rules or restrictions after moving abroad.