QROPS Macau. Pension Tax Relief
British expats living in Macau or wishing to retire in Macau can now transfer their pension into a QROPS Macau to maximize pension tax relief. British expats living or working in Macau can take advantage of their offshore status and transfer their UK pension offshore to somewhere secure like Gibraltar or New Zealand and will no longer have to pay UK taxes on their pension if they stay offshore. If you are from Macau and have ever worked and built up a substantial pension in the UK, you can also take advantage of a QROPS Macau to avoid UK taxes.
Macau is, along with Hong Kong, one of the two special administrative regions of the People’s Republic of China. It lies on the western side of the Pearl River Delta, bordering Guangdong province to the north and facing the South China Sea to the east and south.
The territory’s economy is heavily dependent on gambling and tourism but also includes manufacturing.
Macau was a Portuguese colony and both the first and last European colony in China. Portuguese traders first settled in Macau in the 16th century and subsequently administered the region until the handover on 20 December 1999. The Sino-Portuguese Joint Declaration and the Basic Law of Macau stipulate that Macau operates with a high degree of autonomy until at least 2049, fifty years after the transfer. Known for its casinos, about 6,300 Brits live in Macao.
Why live or retire in Macao as a British expat?
The mixing of the Chinese and Portuguese cultures and religious traditions for more than four centuries has left Macau with an inimitable collection of holidays, festivals and events. The biggest event of the year is the Macau Grand Prix in November, when the main streets in Macau Peninsula are converted to a racetrack bearing similarities with the Monaco Grand Prix.
Other annual events include Macau Arts festival in March, the International Fireworks Display Contest in September, the International Music festival in October and/or November and the Macau International Marathon in December. Dragon Boat festival is brought into play on Nam Van Lake in June and Hungry Ghosts’ festival, in late August and/or early September every year. All events and festivities of the year end with Winter Solstice in December.
Local cooking in Macau consists of a blend of Cantonese and Portuguese cuisines. Many unique dishes resulted from the spice blends that the wives of Portuguese sailors used in an attempt to replicate European dishes. Typically, Macanese food is seasoned with various spices and flavours including turmeric, coconut milk, cinnamon and bacalhau, giving special aromas and tastes. Famous dishes include Galinha à Portuguesa, Galinha à Africana (African chicken), Bacalhau, Macanese Chili Shrimps and stir-fry curry crab. Pork chop bun, ginger milk and Portuguese-style egg tart are also very popular in Macau.
Benefits of Moving Your UK Pension to a QROPS Macau
What are the benefits of a QROPS Pension Transfer for British expats in Macau?
• 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: The pension is held in a secure jurisdiction such as Gibraltar or New Zealand which is under the protection of the British Crown, but has its own strong financial regulations which are tax efficient
What is QROPS Macau?
A Qualifying Recognized Overseas Pension Scheme (QROPS Macau) allows your UK pension to be transferred offshore to reduce your tax burden. Effectively, you will no longer pay UK tax on your pension whilst you are offshore and after 5 years of living offshore, the reporting requirements to HMRC cease.
If you are living in Macau at the moment, you can take advantage of your offshore address in order to move your UK pension into a QROPS Macau to avoid further UK taxes down the line. A QROPS Macau is the perfect vehicle to avoid UK taxes if you are considering living or retiring abroad.
What is the economy of Macau like?
Macau’s economy is based largely on tourism. Other chief economic activities in Macau are export-geared textile and garment manufacturing, banking and other financial services. The clothing industry has provided about three quarters of export earnings, and the gaming, tourism and hospitality industry is estimated to contribute more than 50% of Macau’s GDP, and 70% of Macau government revenue.
Macau is a founding member of the WTO and has maintained sound economic and trade relations with more than 120 countries and regions, with European Union and Portuguese-speaking countries in particular; Macau is also a member of the IMF. The World Bank classifies Macau as a high income economy and the GDP per capita of the region in 2006 was US$28,436. After the Handover in 1999, there has been a rapid rise in the number of mainland visitors due to China’s easing of travel restrictions. Together with the liberalization of Macau’s gaming industry in 2001 that induces significant investment inflows, the average growth rate of the economy between 2001 and 2006 was approximately 13.1% annually.
What are the taxes for British expats living or working in Macau?
The tax system is very similar to that of Hong Kong. While there are many different taxes that are collected, most expats will only pay several types. Macau has a territorial tax policy in place which means your income is only taxed for what is created in Macau. If your income is derived by other sources than those that reside in Macau, it is non taxable income. For income tax there is a tax structure that goes from 2% to 15% of your income. Corporate tax rate is similar from 3% to 12%.
Besides income tax there are also property taxes, franchise taxes, inheritance tax, professional tax, etc.
A QROPS Macau will avoid UK taxes and Macau taxes.
QROPS Macau Pension Transfers
Do I need to move my pension to Macau?
No. There are no QROPS providers in Macau. If you are a British expat or have ever worked in the UK, your pension can be transferred to a jurisdiction such New Zealand or Gibraltar where it can grow without having to pay any UK taxes. Your pension can then be paid into your local bank account or an offshore bank.
Do I need to live and retire in Macau?
No. But, you need to have an offshore address in order to move your pension abroad. You can then live or retire anywhere outside the UK. If you ever move back to the UK, your pension will revert to typical UK SIPP rules.
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QROPS Macau article written by QROPS Specialists.