Guernsey QROPS Readying For Flexible Access

Guernsey law makers have flexible access for Qualifying Recognised Overseas Pension Scheme (QROPS) on the agenda for discussion.

New regulations following those introduced in the UK in April are scheduled for debate by the Guernsey States next week.

If the bill is passed, the new rules are expected to start from October 2, 2015.

QROPS investors with funds on the Channel Island should not be too hopeful of drawing down on their funds in the same UK pension savers can when they reach 55 years old, though.

The new regulations will only set a framework for Guernsey pension providers to enable flexible access for their schemes if they wish to do so.

Flexi-access for QROPS

If successful, providers will have the option of adding flexible access to their schemes but can choose to stay as they are.

If the bill is passed, Guernsey becomes the second QROPS jurisdiction to allow flexible access.

Malta voted through laws allowing flexible access to QROPS earlier in the year, but to date no providers are offering the option to retirement savers.

Law makers in Gibraltar and the Isle of Man are also known to have similar legislation under consideration but have made no formal move towards adopting the measure.

QROPS experts in Guernsey expect the new legislation to clear the way for new flexible access pension schemes for existing QROPS investors on the island to transfer their funds into rather than alter the status of any existing schemes.

Delisted schemes

Guernsey States indicated flexible access would gain a green light in February in a statement from deputy Treasury minister Jan Kuttelwascher.

“The government intends to amend the law to allow flexible benefits giving Guernsey QROPS the same status available to pensions in the UK,” he said.

“This flexibility will extend to transfers already made to Guernsey schemes and new transfers.”

Providers and pension investors are waiting to see how the new legislation affects the 300 Guernsey QROPS delisted by HM Revenue & Customs (HMRC) in March 2012.

When HMRC published the latest QROPS List on September 15, Guernsey providers were offering 129 schemes.

The market is estimated to have more than £2 billion invested in current and former Guernsey QROPS.

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