The Changes

Amongst the key points to the proposed QROPS legislation changes is the requirement for New Zealand schemes, looking to receive UK pension transfers, to ensure that their scheme will provide at least 70% ‘income for life’ from the UK transferred fund.

In addition, the current trustee ‘reporting period’ to HMRC for benefits paid from all QROPS, will be extended from 5 years of non-UK residency to 10 years after the member transfers out of a UK registered pension scheme.
It is these major changes to the QROPS rules that will mean UK pension members, who have been outside of the UK for more than 5 complete UK tax years, will no longer have the option to transfer their UK pensions (after 6th April 2012) to a New Zealand QROPS and receive 100% of their funds, as a lump sum, immediately.
Opportunities pre 5th April 2012

• If you have already been outside of the UK, for more than 5 complete UK tax years, AND
• Wish to receive greater than 25% of your UK pension as a lump sum, please contact Global QROPS immediately.

There is a limited time period between now and 5th April 2012 to transfer UK pension benefits to New Zealand and receive these benefits as a lump sum.

Please call +44 (0) 1372 724249 of email info@globalqrops.com for more information.

Last Opportunity for New Zealand QROPS is a post from: Global Qrops

In what will include the most significant changes, for transferring UK pension benefits overseas, since 6th April 2006 – the new proposed legislation will affect all involved in QROPS.

Amongst the key points, in the potential changes, is the difference in the ‘reporting period’ from 6th April 2012.

As the QROPS rules currently stand, once benefits are transferred from a UK pension to a QROPS, the QROPS trustees (or administrators) are obliged to report any payments to the member (or member’s beneficiaries), to the UK’s HMRC, for 5 complete UK tax years of the member’s non-UK residency.

The new changes indicate that the reporting period will be 10 years from date of ‘transfer’- rather than for 5 years of the member’s non-UK residency.

Global QROPS understands that the implications for an individual, already resident outside of the UK for 5 complete UK tax years, will be that any transfers from their UK pension to a QROPS, from 6th April 2012 would mean that their benefits would be subject to reporting back to HMRC for 10 years from the transfer.

Many non-UK residents, with UK pensions, should seek expert QROPS advice from overseas pension transfer specialists, such as Global QROPS Ltd, to take advantage of the existing rules before the proposed changes come into effect in April 2012.

QROPS Legislation Changes – the Reporting Period is a post from: Global Qrops

For full details of the HMRC update see link: http://www.hmrc.gov.uk/NEWS/INDEX.HTM

If an individual does want to complete a UK pension transfer to Australia, they may be tempted to look at the list and work from there. However, HMRC stress that the QROPS list is not a recommendation or advertisement for any particular scheme, it is merely for information purposes for an individual to check that an Australian QROPS that they have received professional QROPS advice on is indeed approved.

Global QROPS Ltd advise many people migrating to Australia on their pension options. It is not, in all circumstances, best advice to transfer pensions to Australia and people need to be aware of all of the advantages and disadvantage before making a decision.

Many of the Australian QROPS on the HMRC list are either Australian employer’s pension schemes or Self Managed Super Funds (SMSF). These schemes may be available for an employee of a company or to an individual that has set up a SMSF but someone looking down the QROPS list could not simply pick out a scheme and apply to become a member.

For advice on a UK pension transfer to Australia, speak to an adviser at Global QROPS Ltd.

A UK Pension Transfer to Australia – The latest HMRC QROPS list is a post from: Global Qrops

Global QROPS Ltd will explain the impact to UK occupational pension scheme members in this position and if there is any QROPS advice that may be affected by this.

What is a Short Service Refund?

Lump sums paid to members who leave an occupational pension schemes within 2 years of joining (known as short service refund lump sums), are permitted by the UK’s HMRC (Her Majesty’s Revenue and Customs) in order to ease the administrative burden for a scheme and reduce the cost of providing an extremely small pension for life for a member.

 The pre Budget Report declared that changes are being made to take into consideration the new 50% upper rate of income tax – coming into force from April 2011.

Short service refund lump sums, made on or after 6 April 2010, will now be taxed at a rate of 20% on the first £20,000 of the refund and 50% on the remainder. (Previously this was 20% on the first £10,800 and 40% on the amount above this).

For potential migrants, taking QROPS advice, there may be little option but to take the refund. Occupational scheme administrators will not always provide a transfer value for members with less than 2 years membership and therefore a transfer to QROPS may not be an option.

Changes to Tax on Short Service Refunds for UK Occupational Pension Members is a post from: Global Qrops

This update has been issued by HMRC because there has been much misinterpretation in some quarters regarding residential property as an investment, within QROPS, after the 5 year reporting period.

What has the guidance confirmed?

The guidance has confirmed what the Global QROPS Ltd advisory team already knew, which is the 5 year QROPS reporting period that applies to the payment of QROPS benefits, to a member, does not apply to permitted investments within a QROPS.

It has been incorrectly assumed by people, in the past, that because after 5 complete UK tax years of a QROPS member’s overseas residency benefits can be paid in accordance with local rules of the jurisdiction  (such as income and tax free cash), that investments would also be outside of the UK HMRC’s reporting requirement after the 5 year period.

However, because taxable property investments (such as residential property) are not subject to the same rules as member payment charges in the Finance Act 2004, the ‘5 year rule’ does not apply. There is, in fact, no time limit on the requirement for the QROPS ‘manager’ to report a purchase of a taxable property. Therefore, regardless of how long an individual has been outside the UK, they can not purchase a residential property as an asset within a QROPS.

Global QROPS Ltd would like to stress that these taxable property rules have always applied. The recent guidance HMRC have updated, on their website, has been produced to make this clear.

The UK’s HMRC Issue New Guidance Regarding QROPS and Residential Property is a post from: Global Qrops

Why use Guernsey QROPS? is a post from: Global Qrops