Otto The Squid

I would be careful which SIPP firm you use. There are a few that focus on only expat IFA firms and are not used by highly regulated UK advisers. They allow offshore insurance bonds and autocall notes and so the costs will be off the scale. These SIPPs cost nearly as much as the QROPS.

snikpoh

Yes please. I have also attached a document trying to outline the differences as I have been told them - would you care to comment on this?

Otto The Squid

I will go through each point; happy for others to agree or not agree. I am not giving advice, only comment. Please do not ask me for specific advice.

IHT- there is no IHT on UK pensions, irrelevant point. There is a 10 year reporting period, not 5. Tax on death is Income Tax and then only after the age of 75. A decent IFA would help mitigate any UK tax on this anyway with succession planning

PCLS – Depends on the pension scheme, some UK schemes set up before 2006 can have much larger lump sums than 30%. Higher fees on the funds over the years in a QROPS will mean the overall fund is lower and so is 30% going to get more of a lump sum? And, lump sums are taxable in Spain anyway.

Currency- A UK platform allows multi-currency, more options than offshore insurance bonds (as the adviser firm only appears to have a licence for insurance, they cannot use investment platforms -unless someone can provide a link to their investment regulation)

Income Tax- The Double Tax Treaty and not the pension is important here. Since the income can be paid gross from the UK under this treaty, how can you pay a lower rate that 0% from the UK? The 45% rate only applies to the income one gets over 150,000 pounds. That would mean a fund of about 5 million pounds then. And, I refer to my comment about the tax treaty. Totally spurious reasoning.

Residency- QROPS were not designed to simplify affairs and an expat can have a UK pension wherever they are

Income Drawdown- There is no requirement to buy an annuity in the UK. “ UK rates” is a meaningless comment ( total flexibility in the UK – for expats too) and some QROPS restrict access- such as Gibraltar for example

Investment Options- UK platforms have access to thousands of low-cost funds ( clean funds, ETFs, Passives etc at a fraction of the price offshore ), more than any expat would ever need. All world markets are available

Lifetime Allowance- The LTA has been reducing but will start to increase with inflation from 2018. Those that will have over a million pounds in the fund by retirement could be affected, expats can protect up to 1.25 million at the moment. Why is that not mentioned?

Ongoing advice- How is this investment advice regulated? UK providers can have expat clients and a check on the FCA register will inform people if their UK adviser has MiFID licencing for Spain. Always check the CNMV website before taking advice on investments.

Robinclarke1960

Hello Snikpoh,

I've spoken to several people now and it's clear that you should only use a UK resident FCA regulated Adviser. I have been recommended a guy based in London as you are clearly more protected. I'm going to have a conversation with the 'Adviser' this afternoon. I'll let you know.

Thanks chaps :-)

Pulaski

So there is no tax saving on moving a pension fund out of the UK and into a ROPS, but you might avoid a future penalty. Meanwhile everything I have ever seen and read is that the fees on ROPS are generally higher than on pension funds held in the UK, and I suspect the funds are not as well regulated i.e. not as "safe".

I still firmly believe that it is very rarely, if ever, in anyone's best interest to remove pension funds from the UK no matter where in the world they live.

snikpoh

So, in your opinion, what do you do with the 'pot' once you get to 'retirement' age?

Buying an annuity is clearly not the way to go.

Robinclarke1960

I have just had a long chat with someone who is FCA regulated and fully qualified. I think this is the only way to go for protection.
What I've taken from it is that there are a lot more factors to consider then I initially thought. Key thing I have taken is everyones situation is different and you need to go through that in detail before you make a decision. The guy I spoke to is coming to visit me in two weeks so I will update you if I go with him and what I do. But I will say he did not think QROPS was an option for me with the new legislation.

Robinclarke1960

This is a good article recommended to me about Qrops UK Budget 2017 and QROPS | HMRC Slams Expats with 25% Tax on QROPS

jsk374

I'm looking at moving my UK pension into a SIPP and investing myself.

I am an Australian resident.

Does anybody know of any Australian providers or whether it is possible for an Australian resident to open a SIPP?

Thanks

Loafing Along

As a UK expat very few providers prepared to offer services. I moved my UK pension to a Hargreaves Lansdown SIPP .

Pension Transfers | Transfer your Pension to a SIPP

Transfer of fund very easy but not allowed to make any further contributions.
Service generally very good and I have complete control. Charges calculated as a %age of SIPP

MidAtlantic

I consolidated various small UK pensions into a SIPP with AJ Bell.

jsk374

thanks for the replies

jsk374

The customer service rep at AJ Bell said that as I'm not a UK resident with them I couldn't have one of their SIPPs.

MidAtlantic

I am a permanent US resident and they opened a SIPP account for me last year. I initially did an on-line chat with them with a "specialist" which I was able to print off as a record.

Loafing Along

I had same problem hence choice of HL although their fees are slightly higher