Job losses and new patterns of working in the oil and gas industry are a cause of concern to contractors planning for retirement.
The future of the industry is uncertain as oil prices have fallen from $100 to around $50 a barrel and looks like staying at that level for some while.
As a result, contractors will have to become even more mobile, and retirement planning across borders can be expensive and complicated.
One solution is transferring a UK based pension offshore to a Qualifying Recognised Overseas Pension Scheme (QROPS).
What is a QROPS?
A QROPS is an offshore pension that accepts transfers in from UK pensions and other QROPS.
Around 800 QROPS are available across 40 different financial jurisdictions, but not are suitable for every retirement saver.
QROPS offer tax and investment benefits that are generally beyond those available in a UK onshore pension.
Moving between countries
If you are part of a mobile workforce and do not know where you are likely to settle in the coming years, a third party QROPS offers a solution.
You can benefit from all the features and opportunities a QROPS offers while staying on the move as an expat.
Third party QROPS are based in one country and allow pension savers to live where they wish outside the UK.
Living in a country without a QROPS provider
No problem. The Philippines and Thailand are popular destinations with oil and gas workers in the Asia pacific and neither have local QROPS.
A third party QROPS based in a financial centre such as Malta or Gibraltar are options for countries like this.
A typical rigger can have a QROPS in Malta, be tax resident in Thailand and work anywhere in the world without any issues.
Accessing pension cash
Anyone aged 55 years old or over can draw cash from a QROPS pension. Although UK pension freedoms apply to QROPS, only Malta has passed tax rules to support flexible access, and as yet, no provider offers this facility.
Taking specialist advice
If you are thinking about transferring to a QROPS, it’s important to talk to a professional specialist adviser who is authorised and regulated to give pension advice to match your personal financial circumstances to the right QROPS.
Many expats in the Asia Pacific talk to unregulated advisers, which gives them no recourse to sorting out problems or pursuing compensation if the deal turns sour.
Typically these advisers offer a single QROPS option, charge high fees and try to persuade retirement savers to invest in high-risk schemes as they earn extra commission that way.
