If you are thinking of retiring abroad, then you have a lot to arrange. At the top of the list must be your financial arrangements. However, for a lot of people this can be complicated and you may not know where to start.
If you have already retired or your retirement date is imminent, you may assume that your pension is all sorted out and that it might as well stay where it is – back home in the United Kingdom. As customers of financial institutions we are conditioned to be loyal customers, but refusing to move your business may be costing you money.
There are a number of options that may be available to you if you are prepared to consider moving it abroad to a Qualifying Recognised Overseas Pension Scheme.
The following questions may help you make up your mind about what to do.
How much tax do you want to pay?
You may not consider this to be an issue over which you have any control, until you actually think about the options that are available. The main thing that attracts QROPS customers is the fact that, once their pension is safely outside the UK, it does not attract any UK tax.
The pension may attract tax in the country where you choose your QROPS. However, you and your QROPS adviser are free to choose any scheme in a number of jurisdictions – many of which are tax neutral.
What currency will you be spending?
Until you have watched the value of your pension being eroded by the changing exchange rates the fees that banks charge, you may not appreciate the value of being paid your pension in the same currency that you spend. With a QROPS, you can choose to hold your pension in pretty much any major currency.
When do you need your money?
Finally QROPS may be particularly attractive if you want to take early lump sums. QROPS may be more flexible than UK pension schemes, which may enable you to get your hands on your pension sooner than you would in Britain.
