With the regulatory landscape for QROPS (Qualifying Recognised Overseas Pension Scheme) changing, even more so now that the UK has left the EU, it’s quite understandable that those who had transferred to a QROPS are now questioning whether it actually makes more sense to transfer their QROPS back to a UK SIPP (Self Invested Personal Pension).

 

If you’re wondering whether you should transfer your QROPS back to a UK SIPP, contact us today to understand whether transferring a QROPS back to a SIPP makes sense for you.

So, what are some of the recent changes to QROPS legislation that are effecting QROPS holders?

In respect to Maltese QROPS, changes to Maltese pension investment legislation have meant that professional investment advisers to Maltese QROPS holders are now required to be regulated in the country where the client is resident.

The problem with this new rule is that in many areas of the world there simply are not locally regulated advisers that are willing or able to provide advice to QROPS holders. Take the expatriate that is working for Aramco in Saudi Arabia or Shell in Nigeria, for example. For all the best will in the world, are they likely to be able to find a locally regulated adviser that is going to be able to provide investment advice to their QROPS policy? Not only the investment advice but then everything else that is required in respect to the professional and administrative management of retirement investment policies.

Further, the adviser would need to have suitable investment advice regulation and qualifications in addition to terms of business set-up with the QROPS provider. Would the QROPS provider even be willing to grant that local adviser terms of business with their agency?

QROPS and the Life Time Allowance

QROPS represent a great opportunity to limit future Lifetime Allowance taxes, however, if you’re a significant distance away from the Lifetime Allowance, does it make sense to maintain your pension benefits in an arrangement where there could be further impactful, regulatory changes in the future and that, ordinarily, maintains a higher cost profile than that of a UK SIPP?

UK SIPPs – Globally Tax Friendly, 0% UK Taxes, WorldWide

Did you know that the UK has dual taxation agreements with many other countries of the world? This means that you will not be taxed twice.

If a DTA is in place you will normally simply complete a form, send that form off to HMRC and they tell your pension company not to deduct any tax. You then pay tax locally, wherever you are in the world. This results in the majority of international UK SIPP holders paying 0% UK tax where they are resident. We have helped many clients with arranging this required administration.

There are certain succession benefits to QROPS, however, again these can be limited depending upon where you are resident in the world in the future.

Unlike most other international financial advisers, we work exclusively on a fee-only basis with no commissions taken from the providers we use, at any time. We are UK regulated and most of our senior advisers are Chartered Financial Planners, providing you with the Gold Standard of Financial Planning Advice available.

If you would like to understand as to whether you would be best off moving your QROPS back to a SIPP, contact us today for an initial fee-free meeting to discuss your circumstances further.

 

 

 

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About AES International

AES International advises expatriate clients worldwide on all financial planning matters including retirement planning, offshore bank accounts, savings and investment, insurance, pension transfers and generating income, from wealth accumulated, to support retirement.