108,000 expats have switched £8.8 billion of pension savings out of the UK into the Qualifying Recognised Overseas Pension Scheme (QROPS) over the past decade – so why haven’t you?
QROPS are popular with British expats for a host of reasons.
Here are just a few of them:
Investment opportunity – Offshore QROPS open a new world of investment in funds, markets, commodities and currencies often unavailable in the UK
No limits – Once a UK pension fund is in a QROPS, the lifetime allowance of £1 million does not apply and fund growth is open-ended
Tax-free cash – Depending on where you are tax resident, it is possible to take a tax-free lump sum of up to 30% of the fund value in cash
No more currency juggling – QROPS benefits are paid in several major currencies direct to a local bank, doing away with expensive foreign exchange transfers
Pick up you pension without tax deducted – Tax on QROPS benefits or income is paid locally under tax rules in the country where you live
Pension freedoms on the way – From April 2017, the same pension freedoms retirement savers enjoy in the UK will be extended to QROPS outside the European Union, says The Treasury and HM Revenue and Customs (HMRC), although final details are yet to be revealed
QROPS can move with you – Many providers will provide a secure home for your QROPS while you travel the world, saving the hassle and cost of switching pensions between countries every time you move
And there’s more
These features are great for expats in good health who intend to enjoy their retirement savings, but some expats with lifestyle conditions or suffering long-term illness may want to pass their pension pots on to their loved ones.
QROPS rules can facilitate this with the help of an estate planning lawyer.
Expats can pass on unspent pension pots to their loved ones. Inheritance taxes paid on the transfer of funds depend on the tax rules where your estate is administrated and those in the places your beneficiaries live.
Finding the right QROPS should not be too difficult with the help of a professional offshore pension adviser.
Currently, HMRC has almost 1,300 pensions in 40 different countries list on their QROPS List.
QROPS Information and Guidance
For more information about QROPS and the benefits it provides, download the iExpats QROPS Guide or complete the Get Advice form.
