What is a QROPS
A Qualified Recognised Overseas Pension Scheme.
QROPS were introduced in 2006 for British expats to keep their savings close by, but the schemes have since been found to offer extensive benefits which have never and will never be available as long as retirement funds remain in the UK. As well as being able to choose the currency and avoid exchange rate fluctuations, tax liability on withdrawal can be hugely reduced too.
There are a whole host of other benefits available, depending on which scheme and which jurisdiction is selected. Retirement can be taken at 55 in many cases, and with a lump sum available immediately, it's easy to see why many members of current UK pension schemes are looking elsewhere to secure their future. QROPS have increased in popularity hugely since their introduction, and although the public sector will no longer have access to these schemes in the near future, all other pensions will still be able to benefit from the extensive advantages that can be found by taking savings away from the unstable UK market.
If you have a UK pension and now either reside outside of the UK or plan to, you can transfer your pension into a QROPS – and access a host of benefits.
Put simply, a QROPS is an overseas pension scheme recognised by HM Revenue and Customs (HMRC) which can accept a UK pension transfer. The benefits of transferring your fund into a QROPS include increased tax efficiency, total investment freedom and large growth opportunities – to name just a few.
“QROPS is an Overseas Pension Scheme that can accept UK pension transfers”
As your pension is probably your second most valuable asset after your home, these benefits really matter, and can dramatically improve your life in retirement.
This demand for QROPS has been a key factor in their development and refinement, and so far over 30,000 expats have transferred their UK pension into a QROPS since the schemes were launched. And with over 350,000 Britons leaving the UK to begin a new life every year, the demand shows no sign of slowing.
QROPS' ability to simplify an individual's retirement has helped as well. With a QROPS, it is much easier to move away from outdated arrangements, and consolidate numerous pensions under one roof. Whatever your reason for considering a QROPS, this guide is essential reading to ensure you understand the benefits of QROPS, and can make an informed decision.
Benefits can be drawn from age 50 (55 for UK transfers)
Flexible income payments
Up to 30% Pension Commencement Lump Sum
Investments grow free of tax (except for withholding tax on dividends)
Potentially Exempt from UK inheritance tax
No UK ‘death’ tax for members that have been non-UK tax resident for 5+ years
No limit on the amount of contributions/growth
Consolidation of multiple pensions
No need to purchase an insurance annuity
Any residual funds on death can be passed to chosen beneficiaries
Funds can be held in all major currencies
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We may even discover that QROPS is in fact not suitable for your needs and may therefore recommend alternatives.
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