September 18th, 2010
QROPS (Qualifying Recognized Overseas Pensions Schemes) and latterly QNUPS (Qualifying Non UK Pension Schemes) are an important retirement planning tool for UK Independent Financial Advisers (IFAs) for their clients who are looking to migrate or, indeed, have already moved abroad. Clients themselves are becoming increasingly aware of the opportunities that QROPS provide.
Global QROPS Ltd work alongside UK IFA’s to ensure that the IFA’s offshore and potentially migrating clients are provided with the best advice.
Global QROPS Ltd are often approached by UK IFA’s to assist them regarding QROPS advice and subsequent transfer. Typically a UK IFA may have a gap in their knowledge, when it comes to this specialist area, or would be restricted by their compliance department when it comes to advising on QROPS.
Since the inception of QROPS on A-day (6th April 2006), the advisers of Global QROPS Ltd team have been at the forefront of transferring UK pensions overseas. Our team of advisers work alongside UK IFA’s ensuring that their client receives the best advice and that the introducing IFA is remunerated in the appropriate way.
Once again, Global QROPS LTD has been quoted in the financial journal, Money Marketing stating their position in the IFA market (please see the link):
http://www.moneymarketing.co.uk/offshore/aes-intl-calls-in-specialist-to-mitigate-qrops-risks/1018075.article
Global QROPS Ltd are UK based financial advisers, authorised and regulated by the Financial Services Authority (FSA).
Tags: QNUPS, QNUPS Advice, QROPS ADVICE, QROPS Pension
Posted in News, QNUPS, QROPS | Comments Off
September 15th, 2010
Following Global QROPS Ltd’s news item, posted on our website on 28th August 2010, regarding the proposed annuity changes featured in the UK Treasury’s consultation document – published as a result of the UK Emergency Budget on 22nd June 2010 – this Global QROPS Ltd news item has been composed to further clarify the terms ‘capped’ and ‘flexible’ drawdown.
With effect from 6th April 2010, according to the recently drafted consultation paper, the UK government are looking to abolish compulsory annuity and alternatively secured pension. Abbreviated to ASP, alternatively secured pension is effectively ‘drawdown’ directly from a member’s pension fund – for pension members aged 75 or over.
Currently, prior to age 75, a member of a UK pension or a QROPS, has the option of USP (unsecured pension) which is drawdown pre age 75. USP allows income on the basis of zero to 120% of the GAD (Government Actuary Department) limit until age 75, when the less flexible ASP rules apply.
As Global QROPS Ltd understands, the proposals state that there are two types of drawdown to become available: ‘capped’ and ‘flexible’ drawdown.
Capped drawdown will be on the same basis as USP, but with the ability to continue past age 75 – although the upper limit of 120% GAD will be reviewed to see if it is still a realistic rate to use.
Flexible drawdown will allow an individual to draw an unlimited amount from their fund, with the proviso that the member can demonstrate that they have secured a sufficient minimum income to prevent them from falling back onto the State. The method of assessing this income (known as the Minimum Income Requirement) has not yet been decided.
It is important that people looking to transfer to QROPS (especially those within the QROPS reporting period) are aware of the rules as the levels of income that they take from the QROPS could be affected by this.
For further information, please speak to an adviser at Global QROPS Ltd.
Tags: QROPS ADVICE, QROPS Pension, QROPS SCHEME, QROPS transfer
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September 12th, 2010
The leading UK based financial advisers on UK pension transfers to Australia, Global QROPS Ltd, have once again been quoted in the Financial Times.
The article is centred around UK expat pension members and the most popular destinations for both the individual and their pension. Please see link to article below:
http://www.ft.com/cms/s/2/107e36a4-5a06-11df-acdc-00144feab49a.html
UK expat pension members have, since 6th April 2006, the opportunity to transfer their pension to a QROPS (Qualifying Recognised Overseas Pensions Scheme). Before, 6th April 2006, if you were a UK expat pension member, the only opportunity to transfer your pension overseas would be if your overseas employer, in the country you were resident, accepted pension transfers in.
The introduction of the UK’s overseas pension transfer rules, in April 2006, means that a UK expat pension member can transfer out of their UK scheme to a different jurisdiction to the one where they are residing – providing the receiving scheme is a QROPS.
For someone living in Australia, a pension transfer to Australia is possible (as it was before 6th April 2006) but, as outlined by Global QROPS Ltd in the Financial Times article, an individual has to be aware of the local rules of the scheme before transferring their UK pension across. This is no different for someone living in Australia looking at a UK pension transfer to Australia.
The tax free nature of the benefits of an Australian scheme (that is a QROPS) in payment, can not be ignored for UK expats retiring in Australia – but nor can the limit on the amount that can be transferred in to Australia each tax year, as well as the exchange rate and other Australian tax issues that an individual may be unfamiliar with.
Advice from UK experts, such as Global QROPS Ltd, should be sort by those looking at pension transfers overseas.
Tags: Australian Pension, Australian Pension Transfer, Australian QROPS, Pension Transfer to Australia
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September 8th, 2010
As most people, looking to affect a pension transfer overseas from their UK scheme will be aware, a transfer can only take place if the receiving scheme is a Qualifying Recognized Overseas Pensions Scheme (QROPS). QROPS came into effect with the introduction of Pensions Simplification in the UK. The QROPS legislation was set down in the Finance Act 2004 and in Statutory Instrument 2006/206.
On ‘A-Day’ (6th April 2006), UK Pensions Simplification was launched and with it QROPS.
Although the QROPS legislation addressed many points, such as permitted retirement levels, tax free cash levels, overseas scheme criteria and QROPS reporting requirements – the QROPS rules did not cover the UK IHT (inheritance tax) situation with funds held in overseas schemes. In other words UK pension funds, transferred to an overseas scheme (approved as a QROPS), could be subject to the UK’s IHT rules.
On 15th February 2010, Statutory Instrument 2010/051 – The Inheritance Tax (Qualifying Non-UK Pension Schemes) Regulations 2010 – was introduced to confirm that UK pension funds, transferred in to an overseas scheme, would not be subject to IHT. Furthermore, these rules were backdated to 6th April 2006.
As a result, all QROPS can be considered QNUPS (Qualifying Non-UK Pension Schemes) for UK IHT purposes. However an overseas scheme can meet the QNUPS criteria without being a QROPS.
Although a QNUPS (that is not a QROPS) can not receive transfers in from approved UK schemes, it can provide IHT planning opportunities.
The article attached, from leading UK overseas pension transfer specialists Global QROPS Ltd, explains the introduction of QNUPS:
http://www.moneymarketing.co.uk/channels/retirement-strategy/a-question-of-qnups/1011270.article
Tags: QNUPS, QNUPS Advice, QROPS Pension
Posted in News, Press, QNUPS, QROPS | Comments Off
September 3rd, 2010
QROPS (Qualifying Recognized Overseas Pension Schemes) has increasingly become an excellent commercial opportunity for many overseas trust and pension companies, since the QROPS legislation was introduced by the UK’s HMRC (Her Majesty’s Revenue and Customs) on 6th April 2006.
Since the inception of QROPS, many providers have emerged in countries and jurisdictions such as Guernsey, Isle of Man, Gibraltar, New Zealand and Malta (to name but a few).
Reputable QROPS advisers, such as Global QROPS Ltd, will advise on an appropriate QROPS in a jurisdiction to match their client’s circumstances, as each jurisdiction has their own particular rules and benefits (which apply after the member has been non-UK tax resident for 5 complete UK tax years).
As well as having benefits, many QROPS providers, however, have their own restrictions too – this is usually attributed to the local tax rules or pension regulations in their own country or territory.
To counteract this, QROPS providers are looking at the possibility of setting up a trust outside of their own jurisdiction or even annexing their product with another scheme in an alternative jurisdiction, with the result of offering the customer a full range of retirement options.
Leading QROPS advisers, Global QROPS Ltd, have once again commented on this in leading financial journal, Money Marketing. Please see the link to this:
http://www.moneymarketing.co.uk/pensions/guernsey-qrops-plans-new-zealand-scheme/1011242.article
Please contact Global QROPS Ltd with any questions on transfers to appropriate QROPS.
Tags: QROPS New Zealand, QROPS Pension, QROPS Provider
Posted in Advice, Guernsey QROPS, Isle Of Man QROPS, Malta QROPS, New Zealand QROPS, News | Comments Off
August 31st, 2010
The major problems for members of UK pension schemes, between the ages of 50 and 55, in UK drawdown, who were looking to transfer to QROPS post 6th April 2010, could have been resolved by HMRC in their July pension’s policy document.
The problem came when the retirement age for members of UK pension schemes and members of QROPS (who are within the 5 year QROPS reporting period) increased from age 50 to 55, on 6th April 2010.
As the rules stood, there was a restriction for those who had taken pension benefits through USP (unsecured pension – previously referred to as drawdown) prior to 6 April 2010, when over age 50 but under 55. As long as the USP payments continued to come from the member’s original scheme, as pre 6th April 2010, there was no issue. However, if a UK pension member in USP (between the ages of 50 or 55) was to transfer to another UK pension arrangement or QROPS (for example) the problem arose that HMRC indicated that further income payment from the new scheme would be classed as an unauthorized payment.
The latest HMRC document on this matter states that regulations will be brought in to allow transfers from USP to USP (drawdown to drawdown) to continue without the member incurring the HMRC unauthorized payments charge on any income taken.
This is both a logical step and good news for people whose UK pension is in USP, that are in between the age of 50 to 55, who are looking to transfer to QROPS, even if they are within the QROPS reporting period. Any continuing payments from the new scheme should not be subject to an HMRC charge.
Anyone in USP (or drawdown) looking to transfer to QROPS, should seek specialist QROPS advice from an expert QROPS adviser, such as Global QROPS Ltd, to ensure the process runs smoothly.
Tags: QROPS Drawdown, QROPS HMRC, QROPS Pension, QROPS USP
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August 28th, 2010
As a result of the Emergency Budget, on the 22nd June 2010, the UK Treasury published a consultation document with the proposals for the abolition of compulsory annuities and the new drawdown rules (effective from 2011/12 onwards).
These proposals are very interesting for those people looking to transfer their UK pensions to QROPS (Qualifying Recognized Overseas Pension Schemes).
The new proposals look to remove the requirement to purchase an annuity from a UK scheme, abolish ASP (Alternatively Secure Pension) and introduce two types of drawdown – all affective from 6th April 2011.
All these changes add additional considerations for potential QROPS transfers.
As with all changes to UK pension legislation, QROPS trustees have to be aware because their schemes have to follow the UK rules, and report any payments made to the member, for the first 5 complete UK tax years of a member’s overseas tax residency (known as the QROPS reporting period). Generally speaking, the methods and amounts that can be paid from a QROPS, within the reporting period, have to be broadly in line with what UK schemes permit.
The consultation paper asks for views from the industry (and interested parties). These views will be expressed until 10 September 2010.
Global QROPS Ltd will explain ‘Capped’ and ‘Flexible’ drawdown in later news items.
In the meantime, the pension commencement lump sum will still be tax free, with pensions in payment taxed as income (from UK schemes) – this has not changed in the proposals – and benefits will still be tested against the Lifetime Allowance at the normal Benefit Crystallization Events (BCE’s), such as on transfer to QROPS.
Tags: QROPS ADVICE, QROPS Pension, QROPS transfer, QROPS trustees
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August 24th, 2010
Further to our previous news item regarding the abolition of the Foreign Investment Fund (FIF) taxation rules in Australia, Global QROPS Ltd have been asked to comment on the effect of the removal of FIF on the advice regarding a UK pension transfer to Australia, by the Financial Times Adviser (please see link below):
http://www.ftadviser.com/FinancialAdviser/Pensions/Personal/News/article/20100812/8d9d855c-a3a5-11df-ae7f-00144f2af8e8/Close-Intl-advice-is-critical-for-Brits-retiring-abroad.jsp
In the majority of cases, for UK pension members seeking to retire in Australia, it would be far more tax advantageous to have their benefits paid from an Australian Superannuation scheme (that has been approved as a QROPS), then have their benefits paid directly from a UK scheme – where any income would be taxed at the individual’s highest marginal rate of tax in Australia (if the individual is a permanent resident of Australia).
The removal of the FIF legislation has not changed the basic premise that a tax free retirement, for a permanent resident of Australia, would be best achieved with a pension transfer to Australia. However, now allowing pension funds outside of Australia to grow free from FIF tax, means that getting the best advice on the correct timing of a potential pension transfer to Australia has never been more important.
Simply holding UK pension funds, because they can grow free from FIF, and transferring them closer to retirement in Australia, may not be the answer. The type of UK pension (ie final salary scheme) the exchange rate, the annual Australian cap on overseas pension transfers in and the tax that applies on transfers into Australia after 6 months of the member’s arrival, are just some of the other main considerations that would form part of the advice as to the timing of a UK pension transfer to Australia.
Tags: Australia 6 month rule, Australia Pension Transfer, Australia QROPS, Foreign Investment Fund tax
Posted in Advice, Australia QROPS, News | Comments Off
August 12th, 2010
Retirees moving to Australia on an Investor Retirement Visa, subclass 405 are able to live tax free in Australia by utilising Australia’s tax exemption on foreign sourced income.
The Investor Retirement Visa is designed for individuals aged 55 and over with net assets in excess of AUD$1,000,000. The visa allows you to live in Australia for four years and is renewable every four years thereafter, provided that you continue to meet the eligibility criteria.
With its tax friendly regime for temporary residents, together with all year round sunshine, Australia is a popular retirement destination for British expats. Retiring to Australia also allows you to transfer your UK Pension fund to an Australian Superannuation fund which is registered as a QROPS. Australian QROPS allow you to access your pension fund as a 100% tax free lump sum, once you are outside of the QROPS reporting period.
Global QROPS specialise in advising migrants on how to structure their finances in order to meet the financial requirements for the visa, whilst also taking advantage of the foreign sourced income exemption.
To find out more about the Investor Retirement Visa requirements, or Australian QROPS, please contact the Global QROPS team.
Tags: Australian QROPS, Australian Retirement Visa, Investor Retirement Visa, Retire in Australia
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August 9th, 2010
The Australian government has abolished its punitive Foreign Investment Fund (FIF) regime that taxed permanent residents of Australia on the annual growth of certain foreign pension funds (including QROPS). Under the old rules, the annual fund growth was assessable to tax at an individual marginal rate to a maximum of 46.5%.
The Australian treasury originally announced plans to abolish the FIF regime back in May 2009. However, it is only recently that the draft replacement legislation has been published.
It is proposed that the FIF rules will be replaced with an ‘anti-roll-up’ regime, which is targeted at a very narrow type of foreign accumulation fund.
It appears from the draft legislation, that it will be possible for Australian residents to hold funds in certain overseas pension funds, without paying tax on the annual growth.
Income drawn from a foreign pension fund will generally be assessable to Australian tax, whilst income from an Australian Superannuation fund is tax free. Therefore individuals should still look at the possibility of transferring their funds to an Australian Superannuation Plan. Advice on whether a pension transfer to Australia is in client’s best interests may not be as clear cut as under the previous regime and factors such as the exchange rate, visa status and the individuals long term intentions need to be taken into consideration.
Tags: Australia Pension Transfer, Australian Pension Transfer, Australian QROPS, HMRC QROPS list
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