The Costa Del Sol is packed with leather-skinned British ex-pats soaking up every beam of sunshine that they were deprived of during their professional lives in Britain. The number of retirees fleeing soaring energy and food prices in their twilight years is growing rapidly and their destinations are getting more and more exotic.
This decision is based on a number of reasons, the most prevalent reason behind the climate being the quality of life that ones life savings can deliver in other economies. Of course for many seeking this sort of retirement meant giving up their pension schemes, however after legislative changes in April 2006 the Qualifying Recognised Overseas Pension Scheme or QROPS, was established.
Previously if a pension scheme holder was to leave the country of residence that the pension scheme was made in then they would be unable to claim it. This all changed when it was announced in 2006 that the QROPS pension release scheme was established which means that with the permission of the tax authority, if your pension scheme qualifies it can be released to you in the country you have repatriated to.
HM Customs and Excise has a list of qualifying pension schemes for the UK, however it is available in many other countries. If you are a US resident then it is doubtful that you will be able to participate in QROPS but many other countries can apply. The benefits can be significant however it depends on the individual in questions circumstances and more importantly the country they have repatriated to.
The process begins with application for QROPS and it is recommended to seek expert financial advice regarding the process. This is optimise your chances of a successful application; so whether you are currently residing in another country, in the process of moving or just considering emigrating then you can contact many QROPS experts and arrange free consultations.
The considerable benefits of the QROPS scheme is felt in countries where you do not have to pay tax on payments such as pensions. There is a period of 5 years which is referred to as the reporting period, when the QROPS provider has to report all financial activity to the residents tax office. After this period has elapsed then you are free to do what you wish with the QROPS money.
There will be specific restrictions with each country however in many cases money can be obtained tax free, or financial experts can advise on relocating your QROPS to a third country. This is useful if the country of residence has in place similar tax framework and restrictions as the UK when it comes to accessing benefits.
Another key QROPS benefit is that there is no need to purchase an annuity. This means that the pension holder does not have to purchase an agreement with your pension provider to pay monthly instalments from your pension savings, unlike in the UK where severe penalties can be incurred. If an annuity in not put in place by 75 in the UK, the tax office can levy a charge of 82 percent of the pension fund.
This enables an individual to withdraw or transfer a lump sum to re-invest in other, potentially more lucrative investments plans. This also means that upon the death of the policy holder, their pension fund can be left in a will to other parties, as opposed to the UK when upon death many pension schemes terminate. It is advisable to seek expert financial advice on QROPS before making an application.
Author Resource:-
Shaun Parker is an expert on QROPS and provides impartial advice on all aspects of emigration finance.
![[Valid RSS feed]](images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
