QROPS, QROPS Gibraltar

QROPS Gibraltar

QROPS Gibraltar Pension Transfers for British Expats

British expats living abroad can now transfer their pensions to Gibraltar to avoid UK taxes. A QROPS in Gibraltar avoids all UK taxation and has a simple flat rate of tax of 2.5% on their pension income which is deducted at source in Gibraltar.

Gibraltar are now trying to increase their share of the QROPS market by toughening up on their own pension regulations. HMRC gave Gibraltar a tough time for having a zero per cent income tax rate and only added them to a QROPS list late in proceedings. Now, Gibraltar are toughening up their rules to gain more market share. The new flat rate tax of 2.5% on pension income has resulted in much higher QROPS business. QROPS in Gibraltar is now leading the way for QROPS business particularly if you live in a country which does not have a Double Taxation Agreement with Malta.

QROPS Gibraltar. Pension Transfer for British Expats

British expats who move overseas and wish to remain outside the UK tax net, can do this through a transfer to a Gibraltar QROPS. This may be useful for those retiring to countries who do not have a Double Taxation Agreement (DTA) with Malta or New Zealand. Jurisdictions who have DTA’s allow access to your pension information in the country you reside in.

QROPS Gibraltar. Amendment to the Pension Regulations

The Gibraltar government has published a Bill that would amend the territory’s legislation to allow local practitioners to offer Qualifying Recognised Overseas Pension Schemes (QROPS) under a regime compliant with new rules set by HMRC.

The Inland Revenue allows the transfer of a UK taxpayer’s pension pot to another jurisdiction in which they are seeking permanent residence, free from tax. However, in recent months, HMRC has introduced more stringent rules concerning these QROPS, removing a number of structures from its list of recognised schemes. Most notably, a number of Guernsey and Isle of Man schemes.

The new legislation in Gibraltar imposes requirements, restrictions and taxation on QROPS in an effort to meet each of the requirements.

New Gibraltar QROPS Regulations

  • A maximum commutation of 30% of the pension fund;
  • A minimum retirement age of 55 (except in very specific circumstances relating to chronic ill health);
  • Taxation of 2.5% on distributions from the fund to beneficiaries of the imported pension scheme;
  • Requirements to prevent an imported pension scheme being transferred to another scheme outside Gibraltar which does not comply with the original requirements; and,
  • Retrospection to April 6, 2006, to enable the small number of pension schemes imported into Gibraltar since that date to comply with the requirements of other jurisdictions which allow exporting of pension funds.

Here is the Gibraltar QROPS PDF for the planned changes.

The Minister with responsibility for Financial Services, Gilbert Licudi, highlighted the importance of the legislation, which he said would ensure access for Gibraltar practitioners to engage in the administration of QROPS. He said: “It opens up a line of business which has previously, in effect, been out of reach for Gibraltar. It will create work for pension schemes administrators and will also create income from taxation for Gibraltar in respect of distributions from the imported pension schemes.”

“It is important to stress that these changes will not affect in any way the benefits which Gibraltar pensioners get from their current pension schemes. The proposals only apply to certain pension schemes established outside Gibraltar and which are subsequently transferred to Gibraltar,” he added.

For those who have already moved into a Gibraltar QROPS, the amendments will not affect the rules governing those occupational pension schemes which have been or may be established in Gibraltar where distributions are taxed at a zero rate, he clarified.

Click here to understand the differences between a QROPS in Gibraltar and a QROPS in Malta

Here is another article which documents when QROPS in Gibraltar first launched

QROPS Trustees in Gibraltar

There are many QROPS trustees in Gibraltar and more are coming online. STM and Sovereign seem to be leading the way in Gibraltar at the moment whilst Brooklands are also looking to launch a QROPS later in 2013.

QROPS Fees in Gibraltar

QROPS fees in Gibraltar generally range from £800 – £1500 per year depending on the size of the pension. There are also QROPS Gibraltar lite products for smaller pensions which has a narrower range of investments. Please email us for the best solution and to get the lowest QROPS fees in Gibraltar.

A Gibraltar QROPS may or may not be the right fit for you. You really need to send us your pension, so we can perform a full analysis to judge where the best destination is for your QROPS or whether it would be better off left in the UK.

For enquiries, please send an email to info@qropsspecialists.com

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