QROPS

QROPS India Pension Transfer for UK Expats to Avoid Paying Taxes


QROPS India. Avoid UK Income Taxes by Moving Your Pension Back to India

British expats living in India or wishing to retire in India can now transfer their pension into a QROPS India to maximize pension tax relief. Also, any Indian born residents in the UK who move back to India can also transfer their pensions and avoid UK income taxes in the UK.

British expats living in India can take advantage of their offshore status and transfer their UK pension offshore to somewhere secure like Malta and will no longer have to pay UK taxes on their pension if they stay offshore.

Indians who have worked in the UK can also transfer to a QROPS. Many Indian nationals spend time working abroad. Whilst working in the United Kingdom, pension benefits may accrue via employers’ occupational or personal pension schemes. Indian nationals who have worked in the UK can also transfer their pension to India via a QROPS in order to avoid UK taxes on their pension. This enables them to pass the entire pension onto their loved ones rather than face a 55% tax in the UK.

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QROPS India Pension Transfer for British Expats

Tax on a QROPS India

What taxes do I have to pay on my pension in India?

Under section 9(1)(iii), pension accruing is taxable in India only if it is earned in India. So, if you are a UK expat or an Indian national who has worked in the UK, you can transfer your pension via a QROPS and avoid UK taxes and Indian personal income tax on your pension.
However, if the person becomes ‘ordinarily resident’ and has lived in India for 9 out of the last 10 years, the income may be taxable.

For the majority, your pension will be paid gross, normally out of a safe jurisdiction such as Malta which is an EU sovereign state, but will be paid tax free in Malta. You can then elect to have it paid into an Indian bank account or paid into an offshore bank account.

Most Indian based QROPS will restrict tax free cash to 33% with the residual fund being used to purchase a compulsory annuity. Therefore, a jurisdiction such as the Malta may be a better jurisdiction and allow more flexibility and freedom of investment to maximize your pension pot.

Why live or retire in India as a British expat?

Britain maintained strong links with India after the British East India company arrived in the 18th Century. A former British colony, the Indian economy has now become the world’s 10th largest economy by nominal GDP and 4th largest economy by purchasing power parity. Following market-based economic reforms in 1991, India has become one of the fastest growing major economies and is considered a newly industrialized country. However, it continues to face the challenges of poverty, illiteracy, corruption and inadequate public health. A nuclear weapons state and a regional power, it has the third-largest standing army in the world and ranks tenth in military expenditure among nations.

It is estimated that 32,000 Brits live in India. Many Indians who have worked in the UK or Indians born in the UK and worked there all their life choose to retire back to India as well.

Benefits of Transferring a UK Pension to a QROPS in India

What are the benefits of a QROPS India Pension Transfer for British expats?

• Avoid UK income tax

• Avoid UK dividends tax


• Avoid UK capital gains tax (CGT)


• Avoid UK inheritance tax (IHT)

• Currency choice. You can choose to have your pension transferred to a QROPS denominated in USD, EUR or keep it in GBP

• Have the ability to make higher returns with freedom of investment

Family Protection: Upon death, the entire pension pot gets passed on to your nearest and dearest

Security: You can transfer your pension to Malta, NZ, Gibraltar or India. Each has its own strong financial regulations with New Zealand having perhaps the most stringent rules.

Is there a QROPS in India?

Yes, there are some Qualifying Recognised Overseas Pension Schemes In India. Click here for the full QROPS List.

QROPS India Comparisons

Indian QROPS

  • No UK income tax and no 55% tax upon death
  • An annuity paid out in Rupees
  • Minimum age for transfer is 39
  • Pension can be paid out immediately
  • The annuity is passed on to your nominated beneficiaries upon death with no tax deducted. After your spouse dies, it can be passed on to your children.
  • No advisor fees
  • Min. transfer is Rs 1 crore (10,000,000 Rupees) or about £125,000 pension pot

However, for wiley investors there is arguably a better way, although you would keep your pension in GBP. New Zealand and Malta for example both have a Double Taxation Agreement with India. But, both have slightly different pension regulations.

New Zealand QROPS for British Expats in India

  • Avoids UK income tax of 0% – 50% and 55% tax upon death in the UK
  • Avoids NZ taxation for British expats in India
  • 100% of pension pot can be passed on as a lump sum upon death
  • 5 investment strategies based on your risk profile

Malta QROPS for British Expats in India

  • Avoids UK income tax of 0% – 50% and 55% tax upon death in the UK
  • Income tax is shared between Malta and India
  • 100% of pension pot can be passed on as a lump sum upon death
  • You can take 50% of any increase in your pension pot after transfer as a lump sum every 3 years
  • Much wider range of investments available. Can purchase most shares, ETFs, bond funds, hedge funds, etc.

Gibraltar QROPS for British Expats in India

  • Avoids UK income tax of 0% – 50% and 55% tax upon death in the UK
  • Income tax is a flat rate of 2.5% at source in Gibraltar. Then you can remit to an offshore bank account or into a bank account in India at which point you pay income tax in India. This is suitable if you are not sure where you will retire.
  • 100% of pension pot can be passed on as a lump sum upon death
  • Much wider range of investments available. Can purchase most shares, ETFs, bond funds, hedge funds, etc.

What are the QROPS Providers in India

Do I need to move my pension to India?

No. There are QROPS in India itself, but your pension would be paid out in the form of an annuity giving you a yearly income and there would be no freedom of investment. It would also be paid out in Rupees only. A move to a secure jurisdiction such as Malta or NZ will allow your pension to stay in GBP and it will be out of the UK tax system. It would grow tax free and there would be no IHT upon death.

What Tax Will I Pay on My QROPS if I Leave India?

As long as you are outside the UK, your QROPS will grow tax free. If you ever return to live permanently in the UK, your pension will simply return to UK Self Invested Personal Pension (SIPP) rules.

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

QROPS India for British expats article written by QROPS Specialists

QROPS India Pension Transfer for UK Expats to Avoid Paying Taxes by

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