Expats are expected to clamber to switch their pensions to Qualifying Recognised Overseas Pension Scheme (QROPS) following the Brexit vote to leave the European Union.
The vote to leave the EU is likely to make expats rethink their savings and investments to look for ways to give them more control and certainty over their finances.
That’s the opinion of Nigel Green, CEO and founder of world leading financial advisers for expats deVere Group.
DeVere chief expects business to grow post-Brexit – https://t.co/lpIglNhYT6 https://t.co/RgSzNYJl3f
— Nigel Green (@nigeljgreen) July 1, 2016
He argues that QROPS can help consumers who have to juggle foreign currency exchange rates to try to maintain their spending power and offer a more certain tax and investment outcome.
“As the reality of what a Leave result in the EU referendum means for personal finances sinks in, people will now be reassessing their retirement planning strategy.
QROPS can help in uncertain times
“We can fully expect demand for HMRC-recognised overseas pension transfers to be further boosted thanks to the UK’s decision to leave the European Union,” said Green.
“Due to the huge amount of uncertainty that’s created, more and more people who are eligible to do so – that’s to say expats and those who are considering retiring outside Britain – will be seeking to safeguard their retirement funds by transferring them into a secure, regulated, English-speaking jurisdiction outside the UK.”
QROPS deal with exchange rate volatility because they pay benefits directly into expat bank accounts in one of a number of major currencies, including US dollars and euros.
Other features include a greater choice of international investments, up to a 30% tax-free cash lump sum and the chance to avoid income tax or inheritance tax on unspent pension funds.
Don’t leave QROPS transfer too late
“Another key reason why the demand for QROPS is set to soar is purely down to volume. We can expect expat numbers to increase,” said Green.
“This is because it’s likely that over the next two years, while Britain is still a full member of the EU, those who are thinking about retiring to places like Spain and France will do so sooner rather than later.
“They will want to move whilst it is still easy to do so. No-one really knows for sure how Brexit will complicate things for Brits seeking to move to other EU countries after the UK has officially exited.”
Further 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.
