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"What are QROPS? QROPS is short for Qualifying Recognised Offshore Pension Schemes as recognised by the Her Majesty’s Revenue and Customs (HMRC). They came into effect in the pension plan simplification regulations of April 6 2006. The reason for this area of the regulations was to allow a Britain pension plan owner to transfer their funds overseas every time they retire to another one QROPS jurisdiction.

So who must look into a transfer to a QROPS?

A person with a UK pension plan who will be either hoping to move offshore or perhaps already interested in move overseas no matter if your pension is presently in payment or not. Furthermore those expatriates who have built up UK pension benefits may also consider a QROPS transfer.

What are the important things about this kind of transfer? This list is by no means inclusive however the preferred reasons are;

1.      To have your pension paid in the same currency that you live in so to steer clear of the erosion of your profits as currency prices change.

2.      Capability to avoid UK income tax on your pension plan income which, dependant upon your country of residence would mean you pay a lower rate of tax therefore get more money.

3.      To never need or be forced to acquire an annuity, which means you can get your pension income as the way you see fit.

4.      To be able to pass on your remaining pension plan fund to your beloved ones on your death. Rather than paying 55% in tax to the British Government.

5.      Bigger investment choice and adaptability which suggests you’re able to maximise your fund growth.

Who should you entrust your money with?You must think of 3 key points as part of your own due diligence;

1.      Ensure that you are using a company who has experience in the market.

2.      Ensure your consultant does a full transfer evaluation, along with the benefits and drawbacks of a transfer which includes fees, jurisdictions and tax considerations.

3.      Due to the advanced nature ensure the specialists are qualified to the industry standard to QCF Level 4. Anyone without these skills will not be doing you justice. There are a variety QROPS jurisdictions where you stand capable of finding a HMRC approved scheme, including Malta, Jersey and the Isle of Man. Having said that there are a selection of rules that have been brought in during April 2012 by the UK Government who has had a severe affect on the amount of schemes which qualify under the new HMRC rules.

HMRC thought that although lots of the schemes were meeting with the letter of the regulation nevertheless they were not in the spirit of the law. Guernsey schemes happen to be particularly terribly hit as schemes registered up until April 2012 allowed non-residents to pay no taxes on their policies while residents were forced to pay taxes. This is often in contravention of the new rules and therefore 310 out of the 313 rules have been taken out of the authorised list.For additional information on QROPS along with the continuous changes to the schemes please e mail us at MyQROPS.net.