Why Use Guernsey QROPS?
Posted by Paul Davies on 22/10/09 14:09
There are many jurisdictions that provide QROPS (Qualifying Recognized Overseas Pension Schemes) for receiving UK transferred pensions. Amongst the jurisdictions considered, by overseas pension transfer specialists Global QROPS Ltd, is Guernsey.
Benefits of Guernsey QROPS
QROPS in Guernsey are generally considered as being tax friendly schemes for pension funds to grow. If a non-Guernsey resident transfers their UK pension funds to a Guernsey QROPS, there will generally be no Guernsey capital gains tax or income tax on any growth or investment within the scheme.
As with UK pension schemes, a Guernsey QROPS can pay a 25% tax free cash lump sum on retirement.
But probably the major benefit of a Guernsey QROPS is that the pension income can be paid tax free to non-residents, at source, from Guernsey. This means that the only income tax, that a Guernsey QROPS pension member would be subject to on income, would be in their country of residence. This would be a more tax efficient way of drawing your benefits than if the pension funds remained in a UK scheme, especially if the new country of residence does not have a double taxation agreement with the UK.
In some cases, a UK pension member may retire to a country that is a ‘tax haven’. In which case, pension income from a Guernsey QROPS could be completely tax free.
Before deciding to transfer you UK pension benefits overseas, an individual should speak to an overseas pension transfer specialist, such as Global QROPS Ltd, for advice on QROPS in all jurisdictions.