QROPS Benefits
For many, the opportunity to invest their UK pensions abroad could not have come soon enough. If you are no longer resident in the UK or are planning to move shortly and are frustrated by the rigidity of British pensions then an overseas pension scheme may well be for you.
No Annuity: Your Choice
In the UK it is currently mandatory to invest in a Compulsory Annuity Purchase at the age of 75. Annuity rates in the UK are fixed and set at a low rate. This system also restricts how your wealth can be passed on to loved ones in the event of your death. With QROPS you are not obliged to purchase an annuity which gives you the freedom to invest money into assets which may yield a much higher return.
0% Inheritance Tax
With inheritance tax set at zero on a Qualifying Recognised Overseas Pension Scheme, compared with as much as 82 percent in the UK, there are substantially more residual funds and it is much simpler to pass these onto the beneficiaries of your choice.
0% Income Tax
There is the option to transfer QROPS to a country, such as Guernsey, which charges no income tax on your pension benefits. Other sources, such as an Isle of Man QROPS, also offer lower tax rates than the UK.
30% Tax Free Lump Sum
At the moment British citizens can take a lump sum of 25 percent from their scheme in the UK. Under QROPS this is set higher at 30 percent.
No Currency Risk
As an example, British pensioners in Spain with a standard UK pension will receive their pension benefit payments in sterling. This means they run an exchange rate risk as well as incurring charges for converting their pension benefit payments into Euros.
By passing over your pension into a QROPS means that you can receive your pension benefit payments in your local currency and therefore eliminate any exchange rate risk and currency conversion charges.
Lower Charges
Set up and running costs are generally significantly lower than in the UK and the fee structure is transparent.
Investment Allocation
There is a much wider choice of investment options under QROPS, you may select from a comprehensive range of flexible plans across a wide range of funds which will help to structure your fund for your circumstances.
Protection of Assets
Under certain QROPS, members can gain greater protection from creditors and claimants than is usually available in the UK.
Expat pensioners and people planning on moving abroad permanently should obtain QROPS advice to find out the full list of benefits that are available by moving your current pension into a qualifying recognised overseas pension scheme.
For further information on QROPS transfers and for a qualified QROPS adviser to contact you, simply fill in your details in the contact a QROPS adviser page to receive free QROPS advice.
