The 2017 UK budget has seen plenty of tax controversy and pensions, like self employment, did not escape tax invasions.
Qualified recognised overseas pension schemes, or QPROPS as it is better known, has arguably been completely overhauled with a 25% tax levied on transfers to QPROPS if you are:
- In a different country to your pension savings or are not in the same country or European Economic Area (EEA)
- Or not part of an occupational pension scheme
The tax deduction will occur before the transfer and responsibility for administrating the tax lies with the pension scheme manager or administrator.
If you are or were relying on QPROPs as part of your pension arrangements, clearly financial planning advice is needed.
The changes came into effect on the 9th March 2017.
Malta Association of Retirement Scheme Practitioners (MARSP) Welcomes the Changes
In a statement MARSP welcomed the changes and stated that it could be part of a wider plan for UK positioning following Brexit and that it was surprising there was no consultation prior to implementing the move.
It went on to state, “The new tax will make transferring expats think twice about the cost implications of such a move and seek assistance from reputable, regulated independent financial advisers, experienced in this complex area.
“MARSP is of the opinion that this shows HMRC and UK Government is serious about ensuring UK tax relieved pensions money is used properly for the purposes of retirement.”
Given the purpose of QPROPS was to make pensions portable for expats, it can be argued that this new measure is a retrograde step and defeats the object unless you live in the EEA or the same country as your QPROPS scheme.
The new tax hike could do considerable damage to your retirement plans, especially if you plan to retire oversees where the weather is better than the UK. If you are unsure of your options at this stage or just want financial advice. Click here and complete the CALL BACK SERVICE form and my award financial panning skills can help you make the most of your investments for a better retirement.
Source: International Investment