The Major Benefits of QROPS Pension Transfer

QROPS stands for Qualifying Recognized Overseas Pension Scheme. It is an overseas pension scheme that fulfills certain requirements so that it can be recognized by Her Majesty’s Revenue and Customs (HMRC). QROPS can receive transfer of U.K. pension benefits without the need of any unauthorized payment and scheme sanction charges.

QROPS is applicable for the U.K. residents who emigrate from U.K. to some other country, having built up a pension fund within a scheme permitted by HMRC. It is also applicable in the case of persons born abroad who have build up benefits in an HMRC authorized U.K. pension scheme and who decide to return to their home country, i.e., U.K.

QROPS offers many important advantages for the natives of U.K. who are pension holders; following are some of its major benefits:

Tax Savings – You can withdraw a lump sum amount of up to 30% from your QROPS; this amount will be tax free. This amount could be more than 30% at times, depending upon the rules and regulations of certain jurisdictions. If you are leaving your QROPS pension amount to your heir(s) after your death, this amount would be exempted from inheritance tax.

Investment Flexibility – With a QROPS account you get the option of choosing from a wide range of investment options. You can also get advice regarding investment from your QROPS advisor.

Currency Exchange Benefit – QROPS also provides you currency exchange benefit. The benefit is in the form of savings you made on currency exchange. Suppose you are withdrawing your pension amount in the country where your QROPS was set up, in this case, you don’t have to transfer money from U.K. to your overseas account. This means that the amount you receive will not get reduced owing to the variation in exchange rates. Also, you will not be required to pay any service charge for currency exchange.

Transfer of Funds – In case of the pensioner’s death, all unused pension funds in his/her account would be transferred to the beneficiaries. There is no need to take an annuity or pay U.K. tax charge upon death of the pensioner.

Consolidating Pension Funds – QROPS allows you to consolidate multiple small pension funds into one. This option provides economies of scale by reducing administration costs.

Gerard Associated Pvt. Ltd. is a Financial Services Authority authorized and regulated firm. The firm deals in financial matters related to Pensions, Investments, Asset Protection, and Tax Solutions, but their specialization is in QROPS. To see the HMRC QROPS list and to get other associated information, you may visit: http://www.gerardassociates.co.uk/.