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QROPs FAQs
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After your death, you can pass your remaining pension fund on to your beneficiaries without incurring inheritance tax or UK tax on income.
You have investment freedom with currency options, lower charges and potential increased returns.
You will never have to buy an annuity.
The UK minimum pension age of 55 will still normally apply before benefits can be taken. But QROPS arrangements can offer greater flexibility, income potential and investment freedom than a UK pension, and the tax benefits can be significant, with the right advice.
There have been problems in the past with QROPS schemes being removed from HMRC’s list, resulting in penalties to both the ceding scheme and the member.
More recently, a judge in a court case concerning a Singapore scheme ruled against HMRC and the penalties and said that members should be able to rely on HMRC’s QROPS list. This has resulted in higher levels of HMRC scrutiny of schemes, and removal of those schemes that do not qualify, meaning that its list can be used with more confidence.
Having said that, it is still very important to obtain professional advice to ensure that the scheme provider complies with QROPS legislation.
You are eligible if you hold a UK pension and intend to live (or have been living) outside the UK for more than five years. So it can apply to you, whatever your nationality, if you have worked in the UK.
No. But it may not be efficient to transfer a single smaller pension. We can advise you about the most cost-efficient options based on the size of your fund and your date of retirement.
The transfer will incur an additional income tax charge if the transfer exceeds the individual’s lifetime allowance, which is currently £1,500,000 (£1,250,000 from April 2014).
Below this amount, there is no taxation at transfer at all.
Anyone with a pension fund larger than £1,250,000 contemplating a transfer should contact us for specialist advice.
You can return to the UK without prejudice. When you do so, the rules of a normal UK pension then apply to the QROPS.
No. Any unauthorised withdrawals over 30% could lead to a tax charge by HMRC of up to 55%. Contact us for guidance.
For impartial advice on whether it would be in your best interests to transfer your pension benefits overseas, click here to complete our enquiry form. We do not charge for providing a pension transfer analysis and you are under no obligation to proceed. Any transfer of pension benefits would be directly from your existing pension provider to the QROPS provider authorised by HMRC.