If you are going to buy a QROPS it may be tempting to purchase it from your bank or building society. However, in this scenario it is always worth shopping around before you commit yourself. After all, if getting advice from an independent QROPS expert is free, what do you have to lose?
Tied agents do not, by definition, have access to the whole of the market. Accordingly, whilst they may be able to recommend the best QROPS that their tied institution offers, this does not translate as being the best that is on the market.
Once you have established who to buy your QROPS from, the next thing to decide is which country it should be based in. The main driver behind this decision is often tax. After all, it is not worth taking yourself out of the UK taxman’s sights to have your pension taxed heavily by another nation.
Fortunately there are many offshore jurisdictions that keep their tax rates very low for non residents, so you have plenty of countries to choose from. Notwithstanding the wide variety of countries that offer QROPS including Malta, New Zealand and Australia, there are a couple of “old favourites” that feature time and time again at the top of QROPS advisers’ list of favourites.
The Isle of Man, Guernsey and Jersey are popular QROPS jurisdictions, not least because of their favourable tax regimes and mature investments communities. But given the long term nature of pension liabilities their political stability is also a comfort to pension savers.
It is tempting to infer that any pension scheme within a QROPS approved country is permitted, but each QROPS must have been approved by HMRC on its own merits. Accordingly, your QROPS adviser must check the credentials of every scheme they consider. Most HMRC approved schemes are on a list that is published on the HMRC website.
Some very exclusive schemes remain off-list, because they want to stay confidential. In this case, your QROPS adviser should get confirmation direct from HMRC about their status.
