QROPS for UK Pension Holders Living Abroad
For those of us who are planning or who have already retired overseas there are many benefits to be gained by transferring your UK pension or pensions into a QROPS pension.
- You do not have to transfer your UK pension to your new country of residence. e.g. a Brit who has moved to Spain does not have to transfer his UK pension to a QROPS in Spain. They are free to find a QROPS that best matches their needs from a more favorable jurisdiction
- Private pensions, SIPPs, Stakeholder and Occupational pensions can all be transferred into a QROPS.
- More than one pension can be transferred and consolidated into one QROPS, e.g. a private pension and a previous occupational scheme.
- You cannot transfer State pensions into a QROPS.
- With a QROPS you could pay less or no income tax.
- If you decide to return to the UK a QROPS can be transferred back into a UK registered pension.
How can a pension scheme become a QROPS?
To become a QROPS the pension scheme must meet the following criteria.
- It must be an overseas (non UK) pension scheme.
- It has to be a recognised overseas pension scheme in the eyes of HMRC.For a scheme to be recognised it has to be established in an EU member state, Norway, Iceland or Liechtenstein or in a country which has a double taxation agreement with the UK.
- Satisfy requirements such as paying a maximum 30% of the pension pot as a pension commencement lump sum.
- The remaining 70% of the pension pot should provide an income for life.
- Pension benefits cannot be payable before the age of 55.
- The scheme must report payments made to members who have been non UK residents for less than five complete consecutive year.
- WARNING if you transfer your pension to a scheme that is not a QROPS your pension will be subject to an unauthorised payment charge totalling 55% of the value of the transferred pension.We strongly recommend that you seek advice from QROPS specialists who are UK qualified financial advisers and also experienced QROPS advisers. Advice from inexperienced and or unqualified financial advisers who do not fully understand QROPS rules, the local tax position and the complex field of UK Pension transfers can ultimately prove to be very costly for the individual pension holder.
Get immediate answers to your questions…
- Are QROPS right for me?
- How can I benefit from a QROPS?
- What are my options?
- Can a QROPS increase my pension income?
To get immediate answers to these and any QROPS questions contact us to speak to a QROPS Pension transfer expert today.
The UK government brought in new QROPS legislation in April 2006 that substantially benefits UK pension holders who have retired abroad. We can provide you with QROPS Advice to show how you can take advantage of this legislation and maximize your pension abroad.
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