QROPS and QROPS Transfers – A Brief Overview

As QROPS become better known and more established, they have become much more popular for expats looking for an alternative to their UK pensions. Because they are rather complex, it’s clear that advice from a professional is essential – and as well as the wisdom of using somebody who knows the ins and outs of QROPS transfers, it is actually a prerequisite for many schemes that the investor has professional representation.

As QROPS continue to grow, so does the number of advisors offering their help. It’s important that you choose a financial advisor who has specific QROPS experience and knowledge – and of course, as with any wealth management matter, you should never use an advisor unless you have first checked that they are fully regulated by the financial authorities in their jurisdiction. Upon approaching an advisor for help with QROPS transfers, you’ll need to disclose details of your UK pensions. You also need to discuss your intentions regarding becoming an expat (if you’re not already one) in order to help them to make the right recommendations for your circumstances.

QROPS – Things to Consider

Your QROPS advisor will be very clear in regards of the need to use an approved QROPS scheme that features on the HMRC list – this protects you from the possibility of being fined or having to pay tax for using a scheme that hasn’t been given the thumbs up by the British tax man. Another HMRC requirement is that the country in which your QROPS lives should manage the schemes in line with pension regulations and taxation laws. Your advisor should also discuss the fact that you can take out a QROPS that is provided by a country different to the one where you live – of course, there will be tax implications surrounding both jurisdictions which you will need to discuss in detail with your advisor.

Another important thing you need to think about and discuss with your advisor is your attitude to risk. QROPS transfers with a greater risk point could provide higher returns, but it may be that you would prefer the security of a low risk option. You also need to consider whether or not you want to be involved in managing your QROPS yourself. If you have experience of managing a SIPPS then you might want to take a more hands-on approach to give you more control over your investment.

Further Considerations

Finally, because QROPS transfers can take place across so many different jurisdictions, you have the option to choose a country that allows you to take advantage of all different asset classes, or perhaps choose a QROPS that allows tax free lump sum withdrawals. Make sure that your financial advisor gives you a clear breakdown of the costs involved with QROPS transfers. These can vary quite dramatically between different providers, but you may be able to get your advisor to negotiate a discount off the fee.

Always visit us if you need to find out more about QROPS QROPS transfers.