The countdown to the first transfers in to Gibraltar QROPS is underway.
Following the Gibraltar Parliament unanimously passing new legislation to kick-start the offshore financial centre’s pension industry, providers have started preparing for transfers in to QROPS from UK funds.
The government and providers are so confident that Gibraltar QROPS will comply with the UK pension rules that they have already taken the first steps to inclusion on HM Revenue & Custom’s QROPS list.
Before opening for business, Gibraltar QROPS have to take three steps:
- The Gibraltar government will officially publish the new law within two weeks
- On publication, providers can apply for regulatory consent from Gibraltar’s Commissioner of Income Tax
- Once the scheme is approved locally, the providers can send details of their schemes for publication on the QROPS list published by HMRC
Gibraltar Association of Pension Fund Administrators chairman Steven Knight said a meeting of the of ltar government officials, including Gilbert Licudi, the minister for finance services is due to take place to cement the details of the QROPS schemes.
“We are determined to ensure Gibraltar is a trusted jurisdiction for pension transfers,” said Knight.
“There will be no pension-busting, no non-compliant investments and only the best administration of pensions.”
Gibraltar QROPS were listed by HMRC in September 2009, but providers declined to accept any transfers as HMRC and the government argued over local tax rules that set a 0% charge which was unacceptable to the government.
The new law provides a 2.5% income tax rate for Gibraltar residents and non-residents for QROPS pension benefits.
Retirement savers switching pension cash to Gibraltar could have faced fines of up to 55% of the transfer fund value if HMRC delisted the QROPS.
Several pension providers have already indicated they will operate Gibraltar QROPs, while some other multi-centre QROPS based in Guernsey are watching HMRC’s reaction.