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QROPS costs and recommendations please

Financial discussion for any financial queries for Expats
Longtermyieldman
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QROPS costs and recommendations please

#59110

Postby Longtermyieldman » June 10th, 2017, 10:23 am

I've been thinking of moving from the UK to a mainland European country, probably Portugal or Malta. Currently I have a SIPP with AJ Bell worth a little over £1m, LTA protected at £1.25m. So there will be no exit charge.

However, the first firm I've consulted has quoted me 3% to move my pension to a Maltese QROPS then 1% a year. That's £10k a year! It wipes out much of the tax benefit of moving, especially once the absence of the option to keep loading up the ISA is removed.

Does anyone here know of a low-cost QROPS provider, as similar as possible to my current AJ Bell account, that will accept an in-specie transfer from my SIPP, allow me to hold UK and maybe some international equities, to trade them online and generally to self-manage my assets? If so, what initial and ongoing charges are involved?

I will also post this in the pensions section of the forum.

torata
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Re: QROPS costs and recommendations please

#59255

Postby torata » June 11th, 2017, 12:48 am

Longtermyieldman wrote:I've been thinking of moving from the UK to a mainland European country, probably Portugal or Malta. Currently I have a SIPP with AJ Bell worth a little over £1m, LTA protected at £1.25m. So there will be no exit charge.

However, the first firm I've consulted has quoted me 3% to move my pension to a Maltese QROPS then 1% a year. That's £10k a year! It wipes out much of the tax benefit of moving, especially once the absence of the option to keep loading up the ISA is removed.

Does anyone here know of a low-cost QROPS provider, as similar as possible to my current AJ Bell account, that will accept an in-specie transfer from my SIPP, allow me to hold UK and maybe some international equities, to trade them online and generally to self-manage my assets? If so, what initial and ongoing charges are involved?

I will also post this in the pensions section of the forum.



Why do you want to move it to a QROPS? You've identified the downside, but I can't see any upside, or any necessity.

torata

richfool
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Re: QROPS costs and recommendations please

#59320

Postby richfool » June 11th, 2017, 1:36 pm

Your SIPP or pension could be managed from, or paid to you, within an EU country without problem. Noted that If the pension was earned within the UK and the income paid to you from the UK, then it would still be subject to UK income tax. I am not aware of the tax implications of moving the pension offshore.

DrBunsenHoneydew
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Re: QROPS costs and recommendations please

#59324

Postby DrBunsenHoneydew » June 11th, 2017, 1:47 pm


Longtermyieldman
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Re: QROPS costs and recommendations please

#59383

Postby Longtermyieldman » June 11th, 2017, 8:44 pm

The case for moving from SIPP to QROPS is tax-driven. Specificially:

- No LTA charge
- Receive 100% of income tax-free for first 10 years
- Thereafter, 85% is tax-free, 15% taxed

Though there are no Portuguese-domiciled QROPS, schemes from anywhere in the EU can be used. Many are in Malta, I believe.

Does anyone here have info on upfront and ongoing charges for such schemes?

FredBloggs
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Re: QROPS costs and recommendations please

#60210

Postby FredBloggs » June 15th, 2017, 6:49 am

I haven't posted here, for despite me being an expatriate worker, I steer well clear of anything "sold" or "marketed" to expatriate workers only. While I obviously, know many other expatriate workers, I know of only one person who has successfully or happily used a QROPS structure (in Australia). I guess there are many happy people out there, perhaps it is just I don't know any of them. I do know a number of people who have used these structures to move their UK pension plans off shore and have been badly burnt. Specifically including a recent case in Malta, where the OP mentioned as a possible destination for your pension fund. I suggest a read of this article from a couple of days ago -
http://www.internationalinvestment.net/opinion/opinion-dont-get-caught-unregulated-rops-qnups-debacle/

roger4
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Re: QROPS costs and recommendations please

#60704

Postby roger4 » June 17th, 2017, 4:00 am

I retired to this island in the Indian Ocean and transferred my SIPP with Hargreaves Lansdown to the local HMRC approved scheme. I researched it and did it all myself. It was relatively straightforward in that all I had to do was fill in the forms provided by the local scheme and 2 months later the cash value was transferred.

Do not look for schemes to do this for you. You wouldn't look for an intermediary to change banks for you, so why would you look for one for your pension?

Do not be put off by the sellers of this service saying it is difficult, it is no more difficult than applying for a passport.

FredBloggs
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Re: QROPS costs and recommendations please

#60705

Postby FredBloggs » June 17th, 2017, 4:09 am

That sounds like great advice to me. There are way too many scammers in this arena waiting to fleece you.

timbo
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Re: QROPS costs and recommendations please

#64237

Postby timbo » July 1st, 2017, 8:39 pm

I think you will find that your income from the SIPP is only taxed in Portugal/Malta (double taxation agreement) and will not be taxed in the UK. So there is no difference between a SIPP and Qrop. The LTA position is different though. You will not find a QROP as cheap as You Invest!

runnygum
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Re: QROPS costs and recommendations please

#134164

Postby runnygum » April 23rd, 2018, 2:52 pm

Under double tax agreement with Portugal there will be no tax to pay in the UK.
NHR status in Portugal should mean none there either for the first 10 years..

pensionman
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Re: QROPS costs and recommendations please

#137242

Postby pensionman » May 6th, 2018, 11:51 am

I may be too late on this one but hope it helps.

I too would advise you to stay away from overseas "financial advisers". Most are unqualified, insurance bond salesmen, providing very little actual advice. QROPS are often unnecessary as well as being expensive. If you have the LTA protection, I don't really see any reason to transfer to a QROPS.

Even though you're no longer in the UK, a UK registered pension scheme is still a good vehicle to use to save for retirement. You'll have tax-free growth, full access to your whole pension from age 55 and up to 25% can be taken tax-free. The remaining 75% is taxed as UK income but you can utilise double taxation agreements, and most British expats will still get the personal allowance which is almost £12,000 pa.

If you're resident in Portugal, you should be able to use the DTA with the UK. Your UK pension income will be paid gross and then you may benefit from the 10-year Portuguese tax exemption.

My company is currently in the process of setting up a DIY SIPP (Self Invested Personal Pension) designed for the non-UK resident, expat market. It won't allow full trading but you will be able to choose investments from a limited range of low-cost funds managed by Vanguard and BlackRock.

We're just waiting on our FCA approval and then the SIPP will be open to investors. In the meantime, you can follow us for updates on social media [Deleted] and the website should go live in a couple of weeks where you will find more information.

Feel free to make any suggestions for features you'd like us to include.
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