The HMRC has announced that “there is no HMRC objection to Gibraltar QROPS commencing or resuming the acceptance of transfers from UK registered pension schemes”. This follows a number of years of uncertainty within the QROPS market where a number of jurisdictions have had many of their QROPS registered plans removed as a consequence of them not meeting with the strict requirements laid down by the UK revenue and customs authorities.
The Gibraltar Association of Pension Fund Administrators have been working hard with both the Gibraltar Government and UK HMRC to ensure that their own QROPS pension rules meet all the requirements stipulated by the UK government. The principle amendment made to Gibraltese legislation was that Gibraltar QROPS must be taxed at a similar rate to local Gibraltar tax rates – even if the policy holder does not live in Gibraltar. Furthermore in the recently passed pension legislation they have now stipulated that all new cases can only take out a lump sum of up to 30%. Pension holders can only crystallize their pensions after reaching the age of 55 – except in the most severe of cases of incapacitation.
It is not usual for the HMRC to deliver such a categorical message of support for a QROPS jurisdiction. It is felt that this was provided because of the current uncertainty in the QROPS market caused by the removal of many previously approved schemes. From the statements issued by the Gibraltar Pension Fund Administrators and Gibraltar Government they appear to be taking a more mature approach to the jurisdictions which are taking a proactive approach to fitting in with the new HMRC guidelines.
We saw the effects on Guernsey when they weren’t willing to fit their QROPS schemes into the spirit of the QROPS regulations being decimated as a consequence.
This is all good news for Gibraltar and their faltering industry. For more information on this and any other questions you might have, please don’t hesitate to get in touch with one of our advisors below.