If you are no longer resident in the UK or are planning to move shortly there are many QROPS benefits when transferring your pension offshore. These include:
- Up to 0% Inheritance Tax – Most QROPS incur no inheritance tax compared with up to 82% in the UK.
- Up to 0% Income Tax –You can transfer your UK pension fund to a QROPS in a country, such as Guernsey or Malta, which charge no income tax on your pension benefits.
- 30% Tax Free Lump Sum – Currently UK pension holders can take a lump sum of 25% from their scheme in the UK. Under QROPS this is set higher to at least 30%.
- No Compulsory Annuity Purchase – In the UK it is currently obligatory to invest in a Compulsory Annuity Purchase at the age of 75. These rates are often low and fixed and restrict how your wealth can be transferred to your family in the event of your death. With QROPS you are not obliged to purchase an annuity, consequently you are able to invest in high yielding investments.
- Investment Allocation – Under a QROPS you have a access to a much wider choice of investments than under a UK pension fund.
- No Currency Risk – There is an exchange rate risk when a UK pension holder converts their pension benefit payment to their new home country. By transferring your pension into a QROPS enables you to receive your pension benefit payments in your local currency and eliminate any exchange rate risk and currency conversion charges.
- Lower Charges – Set up and running costs are generally lower than in the UK and the fee structure is transparent.
- Protection of Assets – Under certain QROPS, members can gain greater protection from creditors and claimants than is usually available in the UK.
For more information on the QROPS Benefits and to contact a qualified QROPS adviser please click here.