Transferring SIPP to QROPS - How difficult it is?

consumer

Hi,

Just wondering regarding my small SIPP plan where the total value currently is less than £5000 and continuing to make monthly contributions. This is in addition to NHS Pension.

In next 2 years, planning to move abroad and was thinking of moving SIPP to HMRC registered QROPS.

How easy is it DIY transfer from SIPP to QROPS?

There are many firms who will do but they generally advise for pension pot of atleast £50000 for transfer to QROPS in addition to their high charges.

Can Moneysavers guide me in this matter?
Thanks

QROPS-quest

Hi consumer,
I've also been thinking about moving my pension pot to a QROPS. Yes, it does all seem as clear as mud! The advice I can offer is limited, but here goes.

Firstly, a 5k pension pot is not worth moving, it seems IMHO. 50k would probably be just about worth the costs involved and 100k would be better.

Secondly, I found this info on a website called "QROPS Adviser"; they say: "Anyone who wants to consolidate UK pension funds with a QROPS transfer has to go through an independent financial adviser, because QROPS providers insist clients are recommended to a scheme that fits their personal financial profile."

I do not know if their point is true - still trying to learn about this stuff myself! Anyway, hope this helps?
QQ

dunstonh

Are you are a UK resident and trying to use QROPS to get the money early or are you resident of another country?

QROPS-quest

Hi dunstonh,
In my case I'm still in the UK but I'm planning on moving to France within about one year or so. A QROPS looks attractive to me because of £/E currency variations, income tax on the pension payments, choice of beneficiaries on death and also, importantly, I think my current pension provider may well be sold on quite soon.

The useual UK pension payment restrictions are just about OK for me, so I am not looking for a 100% pay out of my pension pot via a dodgy scheme in Singapore. The 25% tax free lump sum at 55 is fine. Last time it was valued my pot was about £200k. My current research suggests Guernsey as a good home for the QROPS in Euros; pension to be paid to me living perminantly in France. However, costs to set up and manage a QROPS do look quite high to me! So I'm still researching options.

What-da-ya-think?

Any thoughts or help would be appreciated.
QQ

EdInvestor

QROPS-quest wrote: »

However, costs to set up and manage a QROPS do look quite high to me! So I'm still researching options.

It's still a prretty new market, so costs might well come down in future as it expands. Also, the bigger your pot, the cheaper it should get. Suggest you keep on investigating for the time being.......

QROPS-quest

Hi EdInvestor,
Apparently QROPS have been about since 2006. However, I've only been interested in them for a couple of months now, due to a recent change in my existing pension provider's terms, which now puts me at a disadvantage if retiring at 55.

Anyway, since my last post I have come across a company that states it will set up a QROPS for free, if the pot is over £150k. They say management costs are also zero if fund is "self managed" and invested into one of half a dozen of their recommended "AA rated" investments; which, of course, will generate a commission payment to them.

So far this seems to be closest to what I'm looking for, although it sounds a bit too good to be true maybe? Also the "self managed" investment might be a bit daunting at first. I wonder if there are any courses for managing your own pension fund investments?
QQ

gfplux

My research on QROPS suggests this.
When first started there were a lot of "dodgy" deals done to transfer the Pension money to places like Singapore with a very hefty commission for the salesman but with the promise that ALL of the cash could be take out. These schemes have now been declared illegal by HMG the salesmen have disapeared and the clients are in deep trouble.
Now advisers selling QROPS are trying to shake of this bad start but are facing a little difficulty because of the past. I also imagine some dodgy people are still in the game.
Costs are high as it is new (and shiny) and volumes are low.
I live in Luxembourg and advisers here are selling QROPS that are located in the Isle of Man and the Channel Islands. I am not comfortable with this but that is a purely personal opinion.
There would definitely be some tax advantages for income taken and the ability to pass the pot on the heirs is very appealing.
My attitude to risk is very low so I will continue to sit on the fence.
The more this is discussed the better we all will be. When I first mentioned QROPS on this and other boards some time ago there were no replies. it is good to see more people interested.

KiNeL

I live in France and have just set up a QROPS in the IoM. It was straightforward and only took time because of the 2 insurance companies previously holding the funds dragging their feet and cocking up the paperwork. Fees are a flat £1000/PA

I remain a UK PAYE employee and some of the lump sum is going to be recycled back into my remaining company pension, benefitting from more tax relief - naughty but nice.

There is a handy drawdown calculator here;

http://www.invidion.co.uk/drawdown/index.php?linker=http://www.invidion.co.uk/css/tools.css

QROPS-quest

Hi KiNeL, Your gonna love this... I've been looking at setting up a QROPS for a few months now and I seem to have noticed that the tax position for basing the pension pot in the IoM is worse than putting it into Guernsey. Have you checked this? Is it too late for you to change your position, or maybe you have a way around the problem?
Hope this helps.
QQ