QROPS Tax Free
There are several ways in which QROPS can be said to be tax free. Just as from UK pensions, members of overseas pensions schemes are able to take a tax free lump sum from the fund. However, under the Qualifying Recognised Overseas Pension Schemes this level is set at a higher rate. In the UK the level is 25 percent, while under QROPS the rate rises to 30 percent.
Secondly, a QROPS transfer enables people to move their pension from the UK to residences of low or no tax jurisdictions such as Guernsey. As pension benefits are taxed at source, if your expat pension is now located in a country which has zero percent income tax, then your pension salary effectively becomes tax free. This only becomes possible after you have been a non UK resident for 5 complete tax years, during which time you will still have been paying tax on your pension in the UK if you have started drawing from it.
Thirdly, it gives you comfort in the knowledge that when you die, the rest of your funds can be passed on to your nearest and dearest. In the UK, inheritance tax can almost wipe out the remains of your funds, while amazingly QROPS can offer zero percent inheritance tax. On top of this, there are less restrictions and you are able to decide for yourself who will benefit from these increased funds.
For full details on QROPS pensions tax and all aspects of QROPS, fill in your contact details on the contact a QROPS adviser page for a QROPS adviser to contact you and provide you with free QROPS advice
