After you have transferred your pension.
Aug 5th 2016, 4:16 pm
#1
BE Enthusiast
Thread Starter
Joined: Sep 2007
Location: Halifax, NS
Posts: 473
After you have transferred your pension.
Has anyone transferred their pension here to a RRSP and then used some to purchase a property?
Aug 5th 2016, 5:09 pm
#2
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,682
Re: After you have transferred your pension.
It is possible for your self-directed RRSP to grant you a mortgage on your residential property but it is complicated.
Last edited by JonboyE; Aug 5th 2016 at 5:47 pm.
Aug 6th 2016, 5:53 am
#3
¯\_(ツ)_/¯
Joined: Mar 2010
Location: SW Calgary
Posts: 776
Re: After you have transferred your pension.
I thought when you QROPS transferred a pension, it was into an account that is not an RRSP?
Or an RRSP you can't touch for 10 years? A LIRA?
Or an RRSP you can't touch for 10 years? A LIRA?
Aug 6th 2016, 3:12 pm
#4
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,682
Re: After you have transferred your pension.
It does go into an RRSP but not necessarily a LIRA. My understanding of the old rules is that you could not withdraw anything for the first five years after becoming non-resident in the UK which would have put the home buyers plan (HBP) offside for this time. If you did there was a significant tax to pay to HMRC.
The new rules seem to state that you must not be allowed to access the funds until the minimum pension age in the UK (currently 55) except in the case of serious financial hardship.
The ROPS provider has an obligation to report any withdrawals to HMRC for the first ten years after the transfer. There does seem to be a grey area after the ten year period and before age 55. Most RRSPs that are not LIRAs allow withdrawals at any time and also allow withdrawals under the HBP and lifelong learning plans. From what I can tell, many Australian and New Zealand pension funds were de-listed because they had similar provisions. HMRC may turn its attention to Canada soon.
Aug 9th 2016, 6:42 pm
#5
BE Enthusiast
Joined: Feb 2008
Location: British Columbia, Canada
Posts: 428
Re: After you have transferred your pension.
I don't have particular expertise in this but ...
It does go into an RRSP but not necessarily a LIRA. My understanding of the old rules is that you could not withdraw anything for the first five years after becoming non-resident in the UK which would have put the home buyers plan (HBP) offside for this time. If you did there was a significant tax to pay to HMRC.
The new rules seem to state that you must not be allowed to access the funds until the minimum pension age in the UK (currently 55) except in the case of serious financial hardship.
The ROPS provider has an obligation to report any withdrawals to HMRC for the first ten years after the transfer. There does seem to be a grey area after the ten year period and before age 55. Most RRSPs that are not LIRAs allow withdrawals at any time and also allow withdrawals under the HBP and lifelong learning plans. From what I can tell, many Australian and New Zealand pension funds were de-listed because they had similar provisions. HMRC may turn its attention to Canada soon.
It does go into an RRSP but not necessarily a LIRA. My understanding of the old rules is that you could not withdraw anything for the first five years after becoming non-resident in the UK which would have put the home buyers plan (HBP) offside for this time. If you did there was a significant tax to pay to HMRC.
The new rules seem to state that you must not be allowed to access the funds until the minimum pension age in the UK (currently 55) except in the case of serious financial hardship.
The ROPS provider has an obligation to report any withdrawals to HMRC for the first ten years after the transfer. There does seem to be a grey area after the ten year period and before age 55. Most RRSPs that are not LIRAs allow withdrawals at any time and also allow withdrawals under the HBP and lifelong learning plans. From what I can tell, many Australian and New Zealand pension funds were de-listed because they had similar provisions. HMRC may turn its attention to Canada soon.
The UK changed the rules in regards to QROPS from April 2015 whereby they implemented the "pensions age test". This meant that from April 2015 onwards in order for the provider to meet QROPS rules , they cannot allow access to the pension funds before the age of 55, which is to fall in line with UK pension rules.
Therefore the QROPS provider in Canada should not allow access to any funds transferred from a UK pension ( including homebuyer withdrawal requests ) before the age of 55.
Aug 10th 2016, 12:56 am
#6
Seasoned Maritimer
Joined: Jun 2005
Location: Fredericton, New Brunswick CA
Posts: 8,309
Re: After you have transferred your pension.
The UK changed the rules in regards to QROPS from April 2015 whereby they implemented the "pensions age test". This meant that from April 2015 onwards in order for the provider to meet QROPS rules , they cannot allow access to the pension funds before the age of 55, which is to fall in line with UK pension rules.
Therefore the QROPS provider in Canada should not allow access to any funds transferred from a UK pension ( including homebuyer withdrawal requests ) before the age of 55.
Therefore the QROPS provider in Canada should not allow access to any funds transferred from a UK pension ( including homebuyer withdrawal requests ) before the age of 55.
Aug 10th 2016, 1:23 am
#7
limey party pooper
Joined: Jul 2012
Posts: 9,982
Re: After you have transferred your pension.
Bout money person told us today that there's a hold on our pension transfer as Uk tax people are investigating QROPS transfers in Canada. Checking to ensure that the locked in part is being honoured.
