Uk pensions in Canada
#121
Re: Uk pensions in Canada
Probably even more wothwhile! Employers are VERY keen to rid themselves of the long term reserving liability of final salary pensions! If the value is greater than £30k, you will need UK financial advice before they will transfer out of DB
#123
Re: Uk pensions in Canada
I asked my FA (Who sells IA products through their Fundex subsiduary) about QROPs. He had to seek info from head office as he'd not come across this before. (Not surprising really).
He received a response and forwarded on some detail to me - checklist, process etc. One thing that jumped out and I quote directly from the IA Clarington document:
Q: What is the minimum age to establish a QROPS
at iA Clarington?
A: The client must be 55 years of age or older, per
our agreement with HM Revenue & Customs.
I'm 52, so don't meet this criteria. I understood, perhaps incorrectly that one could move their UK pension into a QROPs at any age, but not access it before a certain age. Is the minimum age quoted an IAG thing or a UK Revenue requirement?
mjwalker007 ?
He received a response and forwarded on some detail to me - checklist, process etc. One thing that jumped out and I quote directly from the IA Clarington document:
Q: What is the minimum age to establish a QROPS
at iA Clarington?
A: The client must be 55 years of age or older, per
our agreement with HM Revenue & Customs.
I'm 52, so don't meet this criteria. I understood, perhaps incorrectly that one could move their UK pension into a QROPs at any age, but not access it before a certain age. Is the minimum age quoted an IAG thing or a UK Revenue requirement?
mjwalker007 ?
Hurlabrick has pretty much covered everything above
#125
Just Joined
Joined: Mar 2021
Posts: 3
Re: Uk pensions in Canada
Hi all
Is it worth transferring a UK SIPP to Canada via a QROPS or better to keep in UK? Sounds like a very onerous process...
Is it worth transferring a UK SIPP to Canada via a QROPS or better to keep in UK? Sounds like a very onerous process...
#126
Re: Uk pensions in Canada
Entirely your decision! If you use an adviser over here (eg Sterling Financial), they are experienced in this and do all of the work. If you DONT transfer, you are taking on the currency fluctuation risk. If you are going to make Canada your permanent home, then I certainly would.
#127
Just Joined
Joined: Mar 2021
Posts: 3
Re: Uk pensions in Canada
Many thanks for reply. I'd consider transferring if there is a pension in Canada similar to a SIPP in UK where you can drawdown from 55 and choose all your own investments. All my stuff is dollar denominated so currency fluctations aren't a huge issue.
#128
BE Enthusiast
Joined: Dec 2020
Location: Ontario
Posts: 761
Re: Uk pensions in Canada
Right now there are just 3 options to transfer from SIPP to Canadian RRSPs: https://www.gov.uk/guidance/check-th...on-list#canada
While the concept of RRSP is very similar to SIPP and you can withdraw at 55, not one of the 3 options available in Canada look attractive. Based on a quick review, these three companies offer high charges and a very restricted list of funds. These ongoing charges will be on top of the costs to transfer your money to Canada. In addition they impose constraints that go beyond a normal RRSP wrapper. For example you may need to file a return in the UK if you withdraw from these accounts within 10 years of the transfer.
Agree that currency risk isn’t an issue, as long as your are invested in equities rather than treasuries. When you start drawing down from your SIPP, you will incur some currency exchange costs, but they will be very small compared to going through ROPS.
Keep monitoring the situation; rules for ROPS change quite regularly.
In Canada, in addition to RRSPs, you can use TFSAs for your “retirement” investment. The latter is similar to ISA. https://www.finiki.org/wiki/TFSAs_versus_RRSPs
Most banks have discount brokerages which offer much better value than the 3 companies selected for ROPS. There also independent discount brokers like Questrade and Qtrade https://www.moneysense.ca/save/inves...ers-in-canada/
Last edited by Mordko; Apr 9th 2021 at 12:10 am.
#129
BE Enthusiast
Joined: Dec 2016
Location: St Catharines, Ontario From Bournemouth UK
Posts: 417
Re: Uk pensions in Canada
Agree with previous comments. To pay 2.5% fees for funds in Canada is crazy. Not that I have any choice as I moved our UK SIPP pensions into income drawdown and withdrew 25% tax free cash before emigrating. We transfer money over whenever exchange rate is better than $1.75 to the pound via transferwise.com
#130
Just Joined
Joined: Mar 2021
Posts: 3
Re: Uk pensions in Canada
Very sage advice Mordko and glendem-- gratefully received, thank you. I'll keep my pension in the UK for now. I did have one niggling worry about handing over the pension to my missus if anything happened to me.... I understand that the UK makes it more difficult than Canada?
#131
BE Enthusiast
Joined: Dec 2020
Location: Ontario
Posts: 761
Re: Uk pensions in Canada
Very sage advice Mordko and glendem-- gratefully received, thank you. I'll keep my pension in the UK for now. I did have one niggling worry about handing over the pension to my missus if anything happened to me.... I understand that the UK makes it more difficult than Canada?
https://www.onlinemoneyadvisor.co.uk...ps/sipp-death/
#132
Just Joined
Joined: Apr 2015
Location: barrie ontario
Posts: 15
Re: Uk pensions in Canada
well Im finaly going the drawdown route on my old prudential retirement policy it has its bonuses I think, this transfer stuff is so confusing plus who do you trust these days fees are probably even more confusing, so Im cashing out doing what hurlabrick mentioned drawdown monthly or every quarter, getting the tax treaty forms form hmrc for cra to sign and return to avoid the double taxation part seems the simplest way , have the funds paid into my self directed tradeing account and invest in the stocks that I want to invest in, Im 74 now so hopefully theres no problems on the horizon but in reality there always are
#133
Re: Uk pensions in Canada
well Im finaly going the drawdown route on my old prudential retirement policy it has its bonuses I think, this transfer stuff is so confusing plus who do you trust these days fees are probably even more confusing, so Im cashing out doing what hurlabrick mentioned drawdown monthly or every quarter, getting the tax treaty forms form hmrc for cra to sign and return to avoid the double taxation part seems the simplest way , have the funds paid into my self directed tradeing account and invest in the stocks that I want to invest in, Im 74 now so hopefully theres no problems on the horizon but in reality there always are
#134
BE Enthusiast
Joined: Dec 2020
Location: Ontario
Posts: 761
Re: Uk pensions in Canada
“and the charges are much lower than Canadian equivalents.”
Don’t they apply platform charges of 0.35% on the first 500k? If so, it seems quite high. What are you comparing against? I am finding that UK SIPP charges with X-O are higher than Canadian discount brokerage charges (which don’t have platform fees if you have enough $s in the account). And X-O appears to be cheaper than Nucleus, although it might work out differently for withdrawals.
Don’t they apply platform charges of 0.35% on the first 500k? If so, it seems quite high. What are you comparing against? I am finding that UK SIPP charges with X-O are higher than Canadian discount brokerage charges (which don’t have platform fees if you have enough $s in the account). And X-O appears to be cheaper than Nucleus, although it might work out differently for withdrawals.
#135
Re: Uk pensions in Canada
“and the charges are much lower than Canadian equivalents.”
Don’t they apply platform charges of 0.35% on the first 500k? If so, it seems quite high. What are you comparing against? I am finding that UK SIPP charges with X-O are higher than Canadian discount brokerage charges (which don’t have platform fees if you have enough $s in the account). And X-O appears to be cheaper than Nucleus, although it might work out differently for withdrawals.
Don’t they apply platform charges of 0.35% on the first 500k? If so, it seems quite high. What are you comparing against? I am finding that UK SIPP charges with X-O are higher than Canadian discount brokerage charges (which don’t have platform fees if you have enough $s in the account). And X-O appears to be cheaper than Nucleus, although it might work out differently for withdrawals.