Taking pension benefits when living abroad.

ChasOconnor

Hello, new to the forum so forgive me if this is not the right place to ask. But looking to see if any other members have come across the same problem and can help solve it or explain it.
I have had a defined contribution personal pension with a household name insurance company for about 20 years. I stopped contributions to it over 10 years ago when I retired early and moved abroad. The fund has stayed invested with the company as I did not want to transfer to a QROPS. I would now like to start taking benefits and called the company to request the drawdown option, but when I explained I am not a uk resident i was told I could not do that. 
I contacted PensionWise and all they could say was that there is no legal reason for that, and that each company has its own rules.
I called a couple of other well known companies to ask about transferring to them to access drawdown, but had the same answer. This is very frustrating as I do not want to take an annuity just now because the rates are so poor.
Has anyone had similar problem? Does anyone know why this should be a problem?
Thank you all in advance.

xylophone

I had a quick google and found this.

http://www.cbfp.co.uk/general-news/flexi-access-drawdown-pensions-for-non-uk-residents

You may need to take specialised advice ?

ChasOconnor

Thank you xylophone... I saw this article a little while back and was a little confused because it was saying that getting an annuity is difficult for non uk residents, and therefore should go for drawdown... completely the opposite to what i have been experiencing. Strange. But thank you very much for looking for me. regards.

bostonerimus

They usually want to deposit the money into a UK bank account. Hargreaves and Lansdown will do drawdown for non UK residents, but you need a UK bank account for the deposit. I wonder if an account with Wise would work because they give you a UK account and bank code number on those. Here is a discussion.

https://forums.moneysavingexpert.com/discussion/6316233/getting-uk-private-pension-when-retiring-in-italy/p1

FYI I looked into drawdown from my US pensions if I ever return to the UK and my provider said that it didn't matter where I lived, but they would only deposit to a US bank, a Wise account was ok. I then asked my US bank if I could use the account if I had a UK address and they said that's ok. But if I wanted to do online transfers from my US bank to a UK bank they need two factor authorization via a text to a US phone or to a USB hardware key. So I got the hardware key and now I can do transfers without a US phone number, just the USB key in my laptop. So make sure you keep accounts active in the UK and wherever you are living.

Thrugelmir

ChasOconnor said:

 Does anyone know why this should be a problem?

Commercial decision most likely. There's no obligation to offer a service to non residents. Most likely too small a number to be economically viable. 

ChasOconnor

Thank you Bostonerimus and Thrugelmir for you help. I will definitely look at the Hargreves Lansdown option.
It really is frustrating trying to get useful information from the company themselves. The people you speak to do not know why these rules are there. I am not resident in the uk, but I have a property there, several bank accounts, uk mobile number and do an annual tax return... but I am not resident so they just say they can't do it. So annoying.

Sunnylifeover50plan

take a look at AJ Bell as well though they also insist on paying drawdown to a UK domiciled bank account. 

Thrugelmir

ChasOconnor said:

 The people you speak to do not know why these rules are there.

Not their job to.  The Board of Directors then the Management are employed to make the strategic and commercial decisions of the business. No different to asking a member of staff in a Supermarket why they don't stock XYZ product. 

robatwork

I asked Aviva what the options are to take a pension abroad. Here's their (slightly woolly) reply:

Taking your retirement benefits

As mentioned previously, your money has to stay in a pension until you’re at least 55. If you are still living abroad when you decide to take your benefits, we might be able to make payment into an overseas bank account. At the moment, you would need to pay a small fee if you wanted this to happen. Otherwise we can make payment into a UK bank account. 

Brie

Have you asked about transferring the pension to a company in either the Channel Isles or the Isle of Man?  That always seemed to be the happy mid point for non UK pensioners.

Dead_keen

Brie said:

Have you asked about transferring the pension to a company in either the Channel Isles or the Isle of Man?  That always seemed to be the happy mid point for non UK pensioners.

I think that would be a very poor choice for most people as there is a 25% tax charge (plus it is a BCE) (assuming it is a QROPS) https://www.gov.uk/government/publications/qualifying-recognised-overseas-pension-schemes-charge-on-transfers/the-overseas-transfer-charge-guidance If it is not a QROPS then it's even more expensive.