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P.I.C. - Qualifying Recognized Overseas Pension Scheme (QROPS)

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A QROPS stands for Qualifying Recognized Overseas Pension Scheme. QROPS are recognized by HMRC (HM Revenue & Customs) and can provide significant taxation and investment benefits to individuals with UK pension rights who have become non-UK residents for tax purposes and were therefore able to transfer their pensions offshore.

Since new regulations came into place in 2006, UK expatriates or foreign nationals who have accumulated pensions in the UK have been able to transfer their pension, whether personal or occupational to an overseas scheme so long as they appear on the HMRC list of QROPS.

In simple terms, QROPS are personal pensions that are established outside of the UK, usually in offshore centres such as Guernsey and Isle of Man. When you retire abroad, you can take them with you to any country in the world, and they will be subject to the tax and pension rules applied within that country. These may provide more flexibility and greater benefits than pension plans in the UK.

To be considered as a QROPS, at least 70% of the fund must be used to give members a lifelong income in retirement. Furthermore, the money cannot be taken out before the age of 50 (55 after April 6th 2010). Pensions can usually be transferred if no annuity has already been purchased or, in the case of a Defined Benefits Scheme, the pension is not already in payment. QROPS must report any payments made from your pension to the HMRC over the first five years. No reporting is required after that period.

Benefits of transferring your pension offshore include:

  • No mandatory requirement to purchase an annuity
  • Ability to pass on your pension fund to your beneficiaries
  • Greater amount of investment choice

Don't wait until you retire to take control of your UK pension; get in contact with P.I.C Middle East today, for free advice on your Pension Transfer. Click Here

       
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