Using QROPS/foreign pensions to avoid the LTA
Posted: January 20th, 2022, 3:48 pm
Hi...
I'm currently 47 with about 900k in my SIPP and employer DC pensions. As such I'm expecting to be well over the LTA by the time I reach 55.
What do people think of transferring a limited amount under QROPS to an overseas pension? By my reading it is still possible to transfer to a pension scheme in Malta without any overseas transfer charge as the EU rules haven't changed post Brexit. I'm assuming you could just move a proportion on your pot (200k say), and that 200k would then be excluded from the LTA allowance going forward.
There doesn't seem to be much discussion on here around that option. I can see that ensuring you pick a good manager, avoiding scams, and watching for high charges would be an issue - but compared to a 55% tax charge the fees wouldn't be significant.
Are there any other downsides here or extra charges when you take any income? The only one I can see is you can't move outside the EU for 5 years without incurring the overseas transfer tax.... but I'm struggling to see any further restrictions for people who remain UK resident.
Thanks
Ian
I'm currently 47 with about 900k in my SIPP and employer DC pensions. As such I'm expecting to be well over the LTA by the time I reach 55.
What do people think of transferring a limited amount under QROPS to an overseas pension? By my reading it is still possible to transfer to a pension scheme in Malta without any overseas transfer charge as the EU rules haven't changed post Brexit. I'm assuming you could just move a proportion on your pot (200k say), and that 200k would then be excluded from the LTA allowance going forward.
There doesn't seem to be much discussion on here around that option. I can see that ensuring you pick a good manager, avoiding scams, and watching for high charges would be an issue - but compared to a 55% tax charge the fees wouldn't be significant.
Are there any other downsides here or extra charges when you take any income? The only one I can see is you can't move outside the EU for 5 years without incurring the overseas transfer tax.... but I'm struggling to see any further restrictions for people who remain UK resident.
Thanks
Ian