Overseas Pension Transfer for Expats

Dave65

Hi
Few months ago, I was in discussion with an independent Financial Institution trying to sell me the idea of transferring my UKpension overseas. I am now self-employed overseas, having being made redundant in last May 2013. I decided not to take up this option.

Just wanted to check again; are there any advantages in transferring UK pension overseas for Expats? Is it legit? Do you end up paying more and not having anything left??

System

Hi

It is legal, a good site is the HMRC QROPS for information.

or here

https://www.gov.uk/government/publications/list-of-qualifying-recognised-overseas-pension-schemes-qrops

There fousands of them.

AS to the value....

You could have a pension paying in local currency and a sterling one, giving a bit of flexibility on exchange rates.

All local currency, who knows what the future holds?

DonM

Yes it is legitimate as QROPS are HMRC sanctioned overseas pension schemes.

QROPS are typically only beneficial for higher transfer values due to costs.

QROPS transfer benefits can be found under the following google search
https://www.google.fr/search?q=qrops+pension+transfer+benefits&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a&channel=fflb&gfe_rd=cr&ei=3lNqVNaqLImX-AbwuYDQAQ#rls=org.mozilla:en-US:official&channel=fflb&q=qrops+pension+transfer+benefits+fully+explained

A good option is to do some homework by reading up what they are etc and then contact some of the companies involved to get some advice

jamesd

In the past QROPS were often promoted on the basis of increased flexibility in taking the money. The change to UK rules from April 2015 to let you take out as much as you want whenever you want eliminates that advantage. Ironically, QROPS probably will have more restrictions than the UK at the moment because the national laws in the QROPS jurisdictions won't have been updated yet. Even after that there is a requirement that the QROPS schemes be open to local nationals on the same basis, so it's entirely possible that the new UK rules will continue to cause the UK rules to be better than all or most QROPS rules. This makes now a particularly bad time to consider QROPS. Lots of uncertainty.

QROPS can offer advantages if you expect to retire overseas, since the tax treatment can be better than in the UK, with the pension income not taxed at UK rates as it would be if you left it in the UK. The UK personal allowance can eliminate this potential benefit for smaller pots, even after the state pension is allowed for. But for pots that can pay more than a few thousand Pounds a year it can still be significantly beneficial to use QROPS on tax grounds.

In general, at the moment, there's probably no strong reason to consider QROPS unless you're about to retire and have to make that jurisdiction of tax for your pension income decision.

Definitely don't eliminate QROPS from consideration completely because as a person who is not in the UK you're in the target area for potentially benefiting.

DonM

As with all frozen pensions you should review them periodically. As such it could be a good time to move your pension if it is not performing. Rather than moving to a UK SIPP you could consider a QROPS which can offer a greater range of investment opportunities among other benefits. Also consider an international SIPP.

If you are not comfortable with doing your own investment decisions look to get professional advice.