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QROPS Questions and Answers

QROPS Questions and AnswersQualifying Recognised Overseas Pension Schemes (QROPS) are growing in popularity with around 10,000 expats a year switching their UK pension pots into the schemes, according to HM Revenue & Customs.

The choice of QROPS is vast – with more than 3,000 separate QROPS offered in 46 different countries worldwide.

Finding the right QROPS is important – so for someone considering a transfer, here are some answers to frequently asked questions:

What is a QROPS?

A QROPS is an offshore pension plan for UK non-residents with pension funds still in the country. It is a pension scheme that is recognised by HM Revenue and Customs (HMRC)

Who can take out a QROPS?

QROPS are for anyone with a UK pension living away from the UK (or planning to do so) and residents of other countries.

Why consider a QROPS?

Retirement savers consider QROPS as a better option than leaving a pension in a UK fund for lots of reasons depending on their personal financial circumstances, for instance:

  • Moving a QROPS offshore removes the fund from future pension rule changes in the UK
  • QROPS can pay a larger tax-free lump sum than UK pensions
  • Investors can access extra markets, commodities and currencies unavailable in the UK
  • QROPS payments can be made in most major currencies, side-stepping currency exchange rate fluctuations

Are QROPS tax-free pensions?

Yes and no. No tax is paid in the UK on fund growth or payments. However, some income tax on benefits may be due in the country where you become tax resident.

How much is a QROPS tax-free lump sum?

This varies between providers, but can be up to 30% of the fund size, compared with a maximum 25% in the UK.

Where’s the best place to base a QROPS?

Most QROPS are customised to a retirement saver’s personal financial circumstances rather than pigeon-holing them into a specific product or provider, so different places are appropriate for different savers.

Popular jurisdictions at the moment include Gibraltar, Malta and the Isle of Man.

Can I self-manage a QROPS?

Yes. Providers offer managed or self-managed funds. Generally, QROPS investors work with an IFA to manage their QROPS, although they do not have to.

Can I move between countries with a QROPS?

Definitely, the only restriction is you cannot be a UK resident. Many retirement savers have a ‘third party’ QROPS based in one country while they live in another.

What are the restrictions of fund sizes?

QROPS rules do not dictate any maximum or minimum fund size, but some retirement savers with small pots may find the charges involved with a transfer are not cost-effective. To try to work around this problem, some providers have introduced QROPS ‘lite’ schemes.

QROPS Advice and Guidance

For all financial matters, seeking independant regulated advice is most important. We recomend speak to the QROPS Group for all UK pension transfer to QROPS advice. They offer a free review of your UK pension scheme.

Saeed Maleki
Saeed Maleki
As the former co-founder of "Yazd Zamaneh" publication (زمانه یزد), Maleki is one of the most experienced reporter working for Pars Herald. Saeed started Zamaneh in cooperation with two local publications on 2007. Two years later he closed his news corporation due to post-election protests in which he was accused of agitating people to demonstrate against Iranian government. On the same year he joined Pars Herald Group as the Economy writer. He is currently studying in Yazd's Payam Nour University perusing his bachelor degree. City: Yazd Phone Number: +989127906398 Email: Saeed {at} ParsHerald.com Name in Persian: سعید ملکی

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