The first tailor-made QROPS offshore pension designed to comply with all HM Revenue and Customs rules and the new Isle of Man 50C law was launched today.
Trinity, from Isle of Man actuaries and pension specialists Boal & Co, was designed alongside the new legislation that allows pensions, lump sums, and death benefits to be paid without tax.
The new 50C rules were only passed by the IoM government last week to let providers on the island compete with rivals in Guernsey, which already pays pension benefits without deducting tax.
Besides paying pension benefits gross of tax, Trinity also pays a retirement lump sum which can, in most cases, be significantly higher than the normal 25% or 30% of fund value found in other QROPS schemes.
Enhanced lump sum payments make Trinity a special QROPS
Gary Boal, managing director of Boal & Co, said: “Trinity rules have been written so that the scheme fully complies with HMRC requirements, without adding unnecessary restrictions. At least 70% of any UK transfer values paid across into Trinity have to be used to provide a pension for life, and must commence no earlier than age 55.
“However, the excess of the pension fund over and above this amount can be used to provide an additional retirement lump sum. All of the investment growth achieved within Trinity can, at retirement, be paid as a lump sum. Expatriate clients who retire outside of the UK can receive a lump sum equal to 100% of fund value less 70% of the initial transfer value.
“In some cases, this can be as high as 75% or 80% of the fund value at retirement. For this single reason alone, transfers already made to QROPS established in other jurisdictions should now be revisited by advisers – as Trinity will generally be able to offer much greater benefits than their current QROPS arrangement.”
Trinity can accept transfers from UK pension schemes, including SIPPs, plus transfers from Guernsey and other QROPS.
The new legislation came into effect on the 22nd October 2010. Trinity is the very first 50C QROPS available.
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