Will Canada make it to the ROPS list ever again?
#1
Will Canada make it to the ROPS list ever again?
Hi guys
So I have been watching this list of HMRC approved ROPS (formerly QROPS) eligible countries. As many of you know Canada was dropped from this list a while ago. Since then there have been two FY budgets in the UK but we did not see any anything changing for the ROPS transfer situation for British Canadians.
Does anyone have any idea if the UK govt will ever consider putting Canada back on this list?
So I have been watching this list of HMRC approved ROPS (formerly QROPS) eligible countries. As many of you know Canada was dropped from this list a while ago. Since then there have been two FY budgets in the UK but we did not see any anything changing for the ROPS transfer situation for British Canadians.
Does anyone have any idea if the UK govt will ever consider putting Canada back on this list?
#2
Re: Will Canada make it to the ROPS list ever again?
To be clear it isn't 'Canada' that the 'UK' have dropped from the ROPS list, it is all of the schemes by all of the Canadian providers that HMRC have removed. This is because HMRC issued a directive to each of the schemes wirh their rules and notification requirements, and NONE of the Canadian schemes agreed to the terms within the required timescales, so all were removed. HMRC did somwthing similar to all of the Australian schemes a few years earlier, with ALL of them being removed, many are now back.
So it is up to Canadian financial services providers to create and sign up with HMRC and meet their requirements. No reason why Canadian schemes cannot be accredited again, but it will take a Canadian company to get off their *rse and get accreditation- which in turn is probably driven by perceived demand.....
So it is up to Canadian financial services providers to create and sign up with HMRC and meet their requirements. No reason why Canadian schemes cannot be accredited again, but it will take a Canadian company to get off their *rse and get accreditation- which in turn is probably driven by perceived demand.....
#3
BE Enthusiast
Joined: Sep 2017
Location: Halifax, NS
Posts: 345
Re: Will Canada make it to the ROPS list ever again?
The company I work in seem to have other fish to fry and have told us that, unless a 3rd party offers a suitable ROP that we can access, this type of business will no longer be done. Take from that what you will.
#4
Just Joined
Joined: Jul 2018
Location: Canada
Posts: 3
Re: Will Canada make it to the ROPS list ever again?
I think you're right Hurlabrick.
That said, my UK financial advisor was telling me recently that he has heard grumblings about a Canadian provider being added to the list "soon". I'm not sure of his source, but it sounded like "a guy that told a guy" type stuff. Sadly, they will have missed an opportunity as there are a good number of ex-Nortel employees that are about to lock in a decision about their UK based pension. Without an available ROPS, the Canadian residents will have to leave the money in the UK. Shame!
That said, my UK financial advisor was telling me recently that he has heard grumblings about a Canadian provider being added to the list "soon". I'm not sure of his source, but it sounded like "a guy that told a guy" type stuff. Sadly, they will have missed an opportunity as there are a good number of ex-Nortel employees that are about to lock in a decision about their UK based pension. Without an available ROPS, the Canadian residents will have to leave the money in the UK. Shame!
#5
Re: Will Canada make it to the ROPS list ever again?
To be clear it isn't 'Canada' that the 'UK' have dropped from the ROPS list, it is all of the schemes by all of the Canadian providers that HMRC have removed. This is because HMRC issued a directive to each of the schemes wirh their rules and notification requirements, and NONE of the Canadian schemes agreed to the terms within the required timescales, so all were removed. HMRC did somwthing similar to all of the Australian schemes a few years earlier, with ALL of them being removed, many are now back.
So it is up to Canadian financial services providers to create and sign up with HMRC and meet their requirements. No reason why Canadian schemes cannot be accredited again, but it will take a Canadian company to get off their *rse and get accreditation- which in turn is probably driven by perceived demand.....
So it is up to Canadian financial services providers to create and sign up with HMRC and meet their requirements. No reason why Canadian schemes cannot be accredited again, but it will take a Canadian company to get off their *rse and get accreditation- which in turn is probably driven by perceived demand.....
#6
Re: Will Canada make it to the ROPS list ever again?
To be clear it isn't 'Canada' that the 'UK' have dropped from the ROPS list, it is all of the schemes by all of the Canadian providers that HMRC have removed. This is because HMRC issued a directive to each of the schemes wirh their rules and notification requirements, and NONE of the Canadian schemes agreed to the terms within the required timescales, so all were removed. HMRC did somwthing similar to all of the Australian schemes a few years earlier, with ALL of them being removed, many are now back.
So it is up to Canadian financial services providers to create and sign up with HMRC and meet their requirements. No reason why Canadian schemes cannot be accredited again, but it will take a Canadian company to get off their *rse and get accreditation- which in turn is probably driven by perceived demand.....
So it is up to Canadian financial services providers to create and sign up with HMRC and meet their requirements. No reason why Canadian schemes cannot be accredited again, but it will take a Canadian company to get off their *rse and get accreditation- which in turn is probably driven by perceived demand.....
Rant over i transferred my pensions in 2007
#7
Re: Will Canada make it to the ROPS list ever again?
I wanted to provide an update following a phone call with Wealthsimple. According to their adviser they are currently coordinating with their counterparts in the UK to register for the ROPS with HMRC. They expect to be able to support pension transfers within the next year or so.
#8
Just Joined
Joined: Nov 2016
Posts: 25
Re: Will Canada make it to the ROPS list ever again?
Very interesting recent decision by a First Tier Tribunal re Q/ROPS below.
Whilst not directly related to Canada (the UK Pensions were transferred to 'QROPS' in Latvia, with funds accessed pre age 55 - clearly outside of all regulations), the content is nonetheless relevant in terms of the wider considerations, particularly in so far as they relate to what constitutes a Q/ROPS, and in respect of 'Unauthorised payments'.
Summary:
Expats win delisted QROPS appeal as judge finds HMRC was too slow - International Investment
Full judgement:
http://financeandtax.decisions.tribu...99/TC06537.pdf
What is perhaps most interesting is that whilst the Tribunal found against HMRC, this was largely only on technical grounds., i.e. failure to go through 'discovery' in good time.
Of more concern is that key arguments put forward by the appellants were rejected (see e.g. P35 onwards), including those related to reliance on Q/ROPS registration etc.. The inference that the Tribinal would have found in favour of HMRC in the event that they had got their 'discovery' act together, is pretty clear.
Overall, the judgement again highlights the need to understand what is an unauthorised payment, and also that appearance on any Q/ROPS list issued by HMRC is absolutely no guarantee that the underlying scheme actually qualifies, then, or at any future time. It is this type of information that was likely not made clear by many Advisors in Canada, (albeit HMRC's opaque and constantly changing requirements over the years has surely also been a contributory factor in the general confusion surrounding the subject).
As such, it further demonstates the quagmire which Q/ROPS has become and gives little comfort to anyone that the situation would be any different even if a Canadian provider does appear/re-appear on the HMRC list at a future time. If e.g.'Wealthsmple' or anyone else gives assurances to HMRC (in order to satisfy ROPS registration requirements) that they categorically will not allow RSP pre age 55 withdrawals arising from ROPS pension transfers, I can't see how this would work, as it would contradict basic RRSP legislation (i.e. withdraw at any time, subject to tax), and as such would surely be open to challenge.
Given the above, any 'Canadian' return to the Q/ROPS marketplace appears fraught with difficulty from all perspectives.
Whilst not directly related to Canada (the UK Pensions were transferred to 'QROPS' in Latvia, with funds accessed pre age 55 - clearly outside of all regulations), the content is nonetheless relevant in terms of the wider considerations, particularly in so far as they relate to what constitutes a Q/ROPS, and in respect of 'Unauthorised payments'.
Summary:
Expats win delisted QROPS appeal as judge finds HMRC was too slow - International Investment
Full judgement:
http://financeandtax.decisions.tribu...99/TC06537.pdf
What is perhaps most interesting is that whilst the Tribunal found against HMRC, this was largely only on technical grounds., i.e. failure to go through 'discovery' in good time.
Of more concern is that key arguments put forward by the appellants were rejected (see e.g. P35 onwards), including those related to reliance on Q/ROPS registration etc.. The inference that the Tribinal would have found in favour of HMRC in the event that they had got their 'discovery' act together, is pretty clear.
Overall, the judgement again highlights the need to understand what is an unauthorised payment, and also that appearance on any Q/ROPS list issued by HMRC is absolutely no guarantee that the underlying scheme actually qualifies, then, or at any future time. It is this type of information that was likely not made clear by many Advisors in Canada, (albeit HMRC's opaque and constantly changing requirements over the years has surely also been a contributory factor in the general confusion surrounding the subject).
As such, it further demonstates the quagmire which Q/ROPS has become and gives little comfort to anyone that the situation would be any different even if a Canadian provider does appear/re-appear on the HMRC list at a future time. If e.g.'Wealthsmple' or anyone else gives assurances to HMRC (in order to satisfy ROPS registration requirements) that they categorically will not allow RSP pre age 55 withdrawals arising from ROPS pension transfers, I can't see how this would work, as it would contradict basic RRSP legislation (i.e. withdraw at any time, subject to tax), and as such would surely be open to challenge.
Given the above, any 'Canadian' return to the Q/ROPS marketplace appears fraught with difficulty from all perspectives.
#9
Re: Will Canada make it to the ROPS list ever again?
Very interesting recent decision by a First Tier Tribunal re Q/ROPS below.
Whilst not directly related to Canada (the UK Pensions were transferred to 'QROPS' in Latvia, with funds accessed pre age 55 - clearly outside of all regulations), the content is nonetheless relevant in terms of the wider considerations, particularly in so far as they relate to what constitutes a Q/ROPS, and in respect of 'Unauthorised payments'.
Summary:
Expats win delisted QROPS appeal as judge finds HMRC was too slow - International Investment
Full judgement:
http://financeandtax.decisions.tribu...99/TC06537.pdf
What is perhaps most interesting is that whilst the Tribunal found against HMRC, this was largely only on technical grounds., i.e. failure to go through 'discovery' in good time.
Of more concern is that key arguments put forward by the appellants were rejected (see e.g. P35 onwards), including those related to reliance on Q/ROPS registration etc.. The inference that the Tribinal would have found in favour of HMRC in the event that they had got their 'discovery' act together, is pretty clear.
Overall, the judgement again highlights the need to understand what is an unauthorised payment, and also that appearance on any Q/ROPS list issued by HMRC is absolutely no guarantee that the underlying scheme actually qualifies, then, or at any future time. It is this type of information that was likely not made clear by many Advisors in Canada, (albeit HMRC's opaque and constantly changing requirements over the years has surely also been a contributory factor in the general confusion surrounding the subject).
As such, it further demonstates the quagmire which Q/ROPS has become and gives little comfort to anyone that the situation would be any different even if a Canadian provider does appear/re-appear on the HMRC list at a future time. If e.g.'Wealthsmple' or anyone else gives assurances to HMRC (in order to satisfy ROPS registration requirements) that they categorically will not allow RSP pre age 55 withdrawals arising from ROPS pension transfers, I can't see how this would work, as it would contradict basic RRSP legislation (i.e. withdraw at any time, subject to tax), and as such would surely be open to challenge.
Given the above, any 'Canadian' return to the Q/ROPS marketplace appears fraught with difficulty from all perspectives.
Whilst not directly related to Canada (the UK Pensions were transferred to 'QROPS' in Latvia, with funds accessed pre age 55 - clearly outside of all regulations), the content is nonetheless relevant in terms of the wider considerations, particularly in so far as they relate to what constitutes a Q/ROPS, and in respect of 'Unauthorised payments'.
Summary:
Expats win delisted QROPS appeal as judge finds HMRC was too slow - International Investment
Full judgement:
http://financeandtax.decisions.tribu...99/TC06537.pdf
What is perhaps most interesting is that whilst the Tribunal found against HMRC, this was largely only on technical grounds., i.e. failure to go through 'discovery' in good time.
Of more concern is that key arguments put forward by the appellants were rejected (see e.g. P35 onwards), including those related to reliance on Q/ROPS registration etc.. The inference that the Tribinal would have found in favour of HMRC in the event that they had got their 'discovery' act together, is pretty clear.
Overall, the judgement again highlights the need to understand what is an unauthorised payment, and also that appearance on any Q/ROPS list issued by HMRC is absolutely no guarantee that the underlying scheme actually qualifies, then, or at any future time. It is this type of information that was likely not made clear by many Advisors in Canada, (albeit HMRC's opaque and constantly changing requirements over the years has surely also been a contributory factor in the general confusion surrounding the subject).
As such, it further demonstates the quagmire which Q/ROPS has become and gives little comfort to anyone that the situation would be any different even if a Canadian provider does appear/re-appear on the HMRC list at a future time. If e.g.'Wealthsmple' or anyone else gives assurances to HMRC (in order to satisfy ROPS registration requirements) that they categorically will not allow RSP pre age 55 withdrawals arising from ROPS pension transfers, I can't see how this would work, as it would contradict basic RRSP legislation (i.e. withdraw at any time, subject to tax), and as such would surely be open to challenge.
Given the above, any 'Canadian' return to the Q/ROPS marketplace appears fraught with difficulty from all perspectives.
So surely the better thing for HMRC to do in order to keep things simple is perhaps to eliminate the requirement of age 55 for withdrawals
#10
Re: Will Canada make it to the ROPS list ever again?
OR, the Canadian ROPS candidate companies agree to ONLY accept customers for RRSP's / ROPs transfers who are already age 55 or older.....
#11
Just Joined
Joined: Nov 2016
Posts: 25
Re: Will Canada make it to the ROPS list ever again?
It would certainly make things simple Edo, but unfortunately, there's more chance of me being elected Pope than the HMRC doing that .
Hurlabrick's suggestion is interesting. Don't know if a carrier could do that without running into any questions of 'discrimination' (?), but it would solve the 'age' problem.Whether it's acceptable to HMRC is anyone's guess.
But, it still wouldn't resolve the unsatisfactory 'self certification' issue of the ROPS list.
Hurlabrick's suggestion is interesting. Don't know if a carrier could do that without running into any questions of 'discrimination' (?), but it would solve the 'age' problem.Whether it's acceptable to HMRC is anyone's guess.
But, it still wouldn't resolve the unsatisfactory 'self certification' issue of the ROPS list.
Last edited by IDB37; Sep 19th 2018 at 6:29 pm. Reason: Edited to add reference to Hurlabrick's post.
#12
Re: Will Canada make it to the ROPS list ever again?
It would certainly make things simple Edo, but unfortunately, there's more chance of me being elected Pope than the HMRC doing that .
Hurlabrick's suggestion is interesting. Don't know if a carrier could do that without running into any questions of 'discrimination' (?), but it would solve the problem.
Whether it's acceptable to HMRC is anyone's guess.
Hurlabrick's suggestion is interesting. Don't know if a carrier could do that without running into any questions of 'discrimination' (?), but it would solve the problem.
Whether it's acceptable to HMRC is anyone's guess.
#13
Just Joined
Joined: Nov 2016
Posts: 25
Re: Will Canada make it to the ROPS list ever again?
I may be wrong, but IIRC, that is what happened in AUS a few years back when they were wiped off the ROP's list. A Canadian company could easily set up a 'clone' RRSP product and just change the minimum age at entry so it is a special plan for ROP's only (I used to set products up on Life Office admin systems in the UK and test them for a living, how easy it is depends on the computer system they use!).
I seem to remember one of the requirements of a QROPS originally was that it was open to anyone living in the Country concerned. Not sure if this is still the case, but if so, would age restrictions not cut across this stipulation ?
Seems to me the only way anyone could ever feel 'safe' in transferring their Pension to a ROPS is if HMRC's list is changed from one of 'self certification' to one of being 'approved' by them, e.g. on an annual basis. However, as it's highly improbable that HMRC would ever do so, no doubt on grounds of inadequate resources/cost etc., it's always going to place impossible demands on Advisor & Client alike to ensure their carrier always complies with the rules, both at the time of transfer and forever thereafter. Which of course no-one can ever do with any degree of certainty.
Hence the tin of worms.
#14
Re: Will Canada make it to the ROPS list ever again?
Interesting.
I seem to remember one of the requirements of a QROPS originally was that it was open to anyone living in the Country concerned. Not sure if this is still the case, but if so, would age restrictions not cut across this stipulation ?
Seems to me the only way anyone could ever feel 'safe' in transferring their Pension to a ROPS is if HMRC's list is changed from one of 'self certification' to one of being 'approved' by them, e.g. on an annual basis. However, as it's highly improbable that HMRC would ever do so, no doubt on grounds of inadequate resources/cost etc., it's always going to place impossible demands on Advisor & Client alike to ensure their carrier always complies with the rules, both at the time of transfer and forever thereafter. Which of course no-one can ever do with any degree of certainty.
Hence the tin of worms.
I seem to remember one of the requirements of a QROPS originally was that it was open to anyone living in the Country concerned. Not sure if this is still the case, but if so, would age restrictions not cut across this stipulation ?
Seems to me the only way anyone could ever feel 'safe' in transferring their Pension to a ROPS is if HMRC's list is changed from one of 'self certification' to one of being 'approved' by them, e.g. on an annual basis. However, as it's highly improbable that HMRC would ever do so, no doubt on grounds of inadequate resources/cost etc., it's always going to place impossible demands on Advisor & Client alike to ensure their carrier always complies with the rules, both at the time of transfer and forever thereafter. Which of course no-one can ever do with any degree of certainty.
Hence the tin of worms.
#15
Just Joined
Joined: Nov 2016
Posts: 25
Re: Will Canada make it to the ROPS list ever again?
Unfortunately, they are only thriving until such time as HMRC decide (as they have done retrospectively in the past), to challenge their validity, and rule that they haven't been meeting the rules, unbeknown of course to all concerned.
Canada's Q/ROPS industry was alive & well for many years until HMRC decided to eliminate it, despite no rules having changed re RRSP's/RRIF's etc..
Extract from the HMRC ROPS list web site:
"HMRC will usually pursue any UK tax charges (and interest for late payment) arising from transfers to overseas entities that do not meet the ROPS requirements even when they appear on this list. This includes where the ROPS requirements have changed and where taxpayers are overseas. HMRC will also charge penalties in appropriate cases."
The above is a nonsensical state of affairs. How is anyone supposed to protect themselves against the inaction (or different interpretation of HMRC requirements) of advisors, back offices of Pension carriers, etc. etc.. The judgement posted earlier included reference to a case where Standard Life's own internal audit had found no problem with a QROPS transfer, yet HMRC still challenged it & would have won, had they not been too slow with the discovery process.