Expats shopping for a Thailand Qualifying Recognised Overseas Pension Scheme (QROPS) may think they are out of luck as the country has never had a scheme listed with HM Revenue & Customs (HMRC).
Expat forums in the country warn of dubious advice as many IFAs are not regulated, but the truth is finding a QROPS is not a problem as long as you know where to look.
Several QROPS centres offer to host pensions for expats who can live in other countries – including Malta, the Isle of Man and Gibraltar.
Malta is a favourite with many expats in the Asia Pacific because the island is a European Union member and has tightly regulated pensions that are closely aligned with British pension legislation.
The island was the first QROPS centre out of 45 worldwide to announce law changes to allow flexible drawdown for the over 55s on the same lines as British pension schemes.
Thousands of British expats live in Bangkok or the tropical paradise islands and beaches offered by Thailand – and many could benefit from the opportunities offered by a QROPS rather than leaving their pensions in the UK.
Many Thais who have lived and worked in the UK and accrued pension rights can also take advantage of switching their funds into a QROPS.
Switching to a Thailand QROPS
- Find out how much your UK pension funds are worth by asking for a transfer value from the provider
- Give the figures to a regulated and experienced QROPS advisor who will discuss your financial options and present you with a short list of suitable schemes
- Remember to take into account cross-border tax issues of moving the money – both the fund transfer from the UK to the QROPS host nation and pension payments from the host to Thailand
- Check the HMRC QROPS List to make sure the provider has self-certified their scheme is indeed a QROPS – this action falls squarely on the shoulders of the transferee and their advisers should the pension not meet the legal requirements. Failing to do this could mean a significant fine.
- Transfer any UK pension fund to the QROPS
Why transfer to a QROPS?
Thailand QROPS pensions offer substantial tax and flexible investment advantages to expats.
On top of that, many QROPS pay out in a range of major currencies, so a Thailand QROPS could be paid in US dollars, avoiding foreign exchange rate volatility and giving expats more spending power.