Otto The Squid

This may be of interest to those with UK pensions

UK advisers sound alarm over Canada pension transfers - International Investment

Useful?

Atlantic Xpat

Interesting. Thanks for sharing.

Pizzawheel

Funny, I just had a call from a crowd in Malta offering a free assessment as long as I sign up this week.

I'd guess Malta is totally wild west unregulated?

mjwalker007

It is important to look at the article and then look at the reality of what Canadian providers are doing to meet ROPS status. I find it strange that this is from a UK based advisor that has no regulatory authority to discuss Canadian pensions and the rules associated with RRSP's or Canadian providers that have ROPS status :


"HMRC last year moved quickly to implement a new “Pension Age Test”. The legislation was passed on 17 March 2015, and took effect on 6 April.
As a result, anyone who is found to have moved their pension to a scheme that would permit someone to access their pension funds before their 55th birthday, directly or indirectly, now faces a significant penalty, known as an “un-authorised payment charge”, levied against them by HM Revenue & Customs."


Although I cannot comment on every Canadian provider on the ROPS list, I can only comment on the providers that I use and I can state that they meet this criteria and will not allow access before the age of 55......therefore meeting the HMRC criteria.


Immediately after this regulatory change took place last year, a number of jurisdictions saw their ability to take pension transfers from the UK all but disappear. In Australia, the hardest-hit of the countries popular among Brits looking to move their pensions abroad, the number of QROP schemes able to take UK pension transfers immediately fell to just one, from 1,653.


This is true, although quite a number of Australian schemes have now changed their rules so they now meet the "pensions age test" laid down by the HMRC in order to achieve ROPS status. The HMRC have now re-listed over 100 Australian pension schemes on their ROPS website.


The advisers who spoke to International Investment about their concerns over UK pension transfers to Canada said they were doing so because they wanted to highlight the issue.
They say they are being pressured by clients who are asking them to approve such transfers, but are extremely wary of being held liable for the consequences, should the Canadian schemes into which these individuals transferred their pensions prove not to meet HMRC’s requirements.


A UK based advisor cannot facilitate a transfer of a UK pension into a Canadian RRSP as only licensed Canadian advisors can set up an RRSP in Canada therefore allowing the transfer of the UK pension. Therefore I am sceptical when in the article it says clients are pressuring them ( i.e uk based advisors ) to transfer their pension to Canada, when ultimately they do not have the regulation to perform this transfer ? As a UK advisor they will not know the rules and regulations in regards to an RRSP in Canada and are not regulated to provide this advice, therefore they cannot advise their clients on transferring a pension to Canada. Could it be they have a motive for not wanting these clients to transfer their pension to Canada.......for example would they rather the client transfer their pension to Malta or some other jurisdiction where they do have the authority to provide this advice ???


Asked about this, an HMRC spokesman said: “Pension schemes need to meet the requirements to be [a] QROPS to receive tax-free transfers from registered pension schemes. If the pension scheme does not meet the requirements, then it is not a QROPS, even if it has notified HMRC that it meets the requirements.
“Pension schemes may be able to change their rules to meet QROPS requirements, so it may not be possible to say that all pension schemes in a particular country do not meet the requirements.
“If an individual member is entitled to payments from their transferred funds before age 55, and an individual gives an undertaking not to request payments, the pension scheme will still not meet the Pension Age Test if the undertaking is not legally enforceable.”


The ROPS providers in Canada that we deal with have all had to re-register with the HMRC as from April of last year to state that they meet the criteria and new rules that were introduced , most notable the "pensions age test" . These providers have all received updated QROPS certificates from the HMRC and are all listed on the HMRC website for Canadian ROPS.


Ultimately all providers have to go through a registration process with the HMRC to apply for ROPS status. On this application the HMRC make it clear what criteria has to be met in order for the company to achieve ROPS status. As discussed I cannot comment on every Canadian provider that appears on the ROPS list but I can comment on the providers that we use and state that they have followed the correct procedures to be listed as a ROPS and so receive QROPS status and meet all of the criteria laid down by the HMRC.

Otto The Squid

Well, the article suggests that Malta could cause an issue with tax, so unlikely. The guy in the UK that is quoted grew up and qualified in Canada, so one would assume he has a reasonable grasp of the alleged problems of Malta for residents in Canada.

I guess, as with all of these things, proceed with caution.

Otto The Squid

Malta is regulated. How well? No idea.

But, check the muppets that called you on here and see what their license covers.

Malta Financial Services Authority

If only insurance, then they will try and sell you an insurance bond and a QROPS. But, regulated or not in Malta, does that regulation extend to providing advice to residents in Canada?

In other words, I assume they can sell you a Malta QROPS but the advice part may not be regulated.

pete.morzine

Hi - I have just been granted PR here in Canada and have a few questions about my pensions back in the UK.

I have a private pension which I understand I can keep in the UK or (maybe) transfer it here....... but the main reason for my post is does anyone have a link to what happens to my UK state pension?

I am 40 years old and paid into the UK pension system for 17 years (I understand 31 years is the maximum amount of years contribution wise to gain a full pension) - will this 17 years worth of contributions be safe (as it can be?!?!) and locked in for me to access when I hit 65 (or whatever the age will be) or can I move this over to Canada at all? Or will I note be eligible......or should I top up.

Any help or pointers will be greatly appreciated

Thanks
Pete

quiltman

As you are only 40, I would suggest you pay voluntary contributions to top up your UK pension. Details easily available via Google. Your UK pension is as safe as any other government backed investment and you will be eligible to draw on it in due course. The International Pensions Dept will pay your pension directly into your Canadian bank if that's what you want, but of course you will not get any annual increase as Canada is not one of the countries UK has a reciprocal agreement with. You can ask for a pension estimate so you have some idea of what you will get. Again, a quick Google will find the forms.

Hurlabrick

Link is here, it is pretty straightforward - I have done it myself......

https://www.tax.service.gov.uk/checkmystatepension

Woollyis69

Great read but UK pension transfers can still be done for now.