Forth Capital’s pension specialists can provide you with unbiased information that allows you to make informed decisions about pension transfers to Australia, the USA, Hong Kong, New Zealand, France, Switzerland, Germany, Ireland, Spain and beyond. Whether you have been living abroad for a day or a decade, our experienced team is just a call away.
Transferring Your UK Pension Abroad
Over the course of your working life you may have had the opportunity to work in one or more countries. You will have experienced different cultures. You may have even found a place that has captivated you to such an extent that you have decided to build your life there. Or perhaps you are a foreign national who lived and worked in the United Kingdom with a private UK pension, and have decided to return home. Whatever your unique personal circumstances, you should consider the benefits of transferring your UK pension into a Qualifying Recognised Overseas Pension Scheme (QROPS).
In April 2006, it was announced that anyone with a personal or occupational UK pension fund who has left or intends to leave the UK to become non-resident for tax purposes may qualify for a QROPS.
The QROPS pension scheme has met the requirements of HMRC and allows individuals to transfer their UK accrued pension into another jurisdiction when they reside abroad.
Who Qualifies for a QROPS?
Anyone with a personal and/or occupational UK pension scheme with at least GBP 50,000+ invested who has either left or is planning to leave the UK in the next 12 months qualifies to apply for a QROPS.
If you fall into the above category you have the opportunity to maximise your pension’s growth and income potential. You can avoid the limitations of a UK pension scheme and the UK lifetime allowance and transfer your pension abroad instead.
The Main Benefits of a QROPS
To those with a significant retirement fund, a QROPS can have considerable benefits:
1. No UK tax payable on pension income.
Transferring your pension out of the UK to a QROPS means that your income will no longer be UK taxable. Depending on your country of residence, you may be able to avoid the UK pension tax rate of up to 45 per cent and instead pay zero taxes.
2. No tax on death.
Although UK pension rules have changed, your beneficiaries will still have to pay tax at their marginal rate if you die over the age of 75. With a QROPS, however, no tax is charged on death at any age.
3. No lifetime allowance.
Currently, the lifetime allowance in the UK is GBP 1 million. With a QROPS, however, there is no lifetime allowance so your pension can grow to any size without a tax charge.
4. Higher lump sum.
A QROPS allows owners to take a lump sum of 30 per cent of their total pension fund. This will be applicable to anyone who has been non-UK resident for more than five years. Generally speaking, only 25 per cent can be taken tax-free in the UK, giving QROPS owners a considerable advantage.
5. Currency and investment options.
A QROPS gives you the ability to hold and invest your pension fund in any currency. A UK scheme will generally be restricted to GBP. In a QROPS, some investment options may be available that would not be available in a UK scheme.
Forth Capital’s QROPS Advice
There are a number of QROPS providers and options available to those who wish to transfer their pension to Switzerland, Germany, Ireland, Spain, New Zealand or other countries worldwide.
However, deciding where to invest your pension funds requires diligence and care. Transferring your funds out of the UK is only the start. Once they have been transferred into an offshore QROPS, further decisions need to be made in terms of how the funds will be invested moving forward.
Forth Capital’s financial consultants are able to give impartial and personal pension advice, guaranteeing full confidentiality about your case. Whether you want to transfer your UK pension into an Australia Superfund or into a fund in Switzerland, there is a suitable solution out there for you. Contact us to discuss your options with regards to QROPS and all other aspects of your pension and financial planning.
Download Our Free Pension Transfer Guide
If you would like to read up on UK pension transfers before meeting with one of our consultants, request a free copy of our UK Pension Transfer Guide. This practical resource will answer the following questions and more:
– How can I pass on 100 per cent of my pension funds to my loved ones?
– Can I take investment control of my pension funds?
– What types of pensions can I transfer?
– How will the 2014 Lifetime Allowance reduction affect me?
– How will the future government policy pension changes affect me?
– What happens next?