QROPS Malta. Pension Tax Relief for British Expats
British Citizens wishing to live or retire in Malta or abroad are now able to transfer their pensions into a Malta Qrops to take full advantage of their pension tax relief options. Expatriates of the UK living abroad or in Malta can leverage their offshore status to transfer their UK pension to a secure location such as Malta which will allow them to avoid paying UK taxes on their pensions so long as they remain offshore.
Whether you are living, working or plan on retiring in Europe, and are not a resident of Malta, you can transfer into a QROPS Malta to avoid paying taxes to the UK. Your pension can then be paid into an offshore account or a EU bank where you reside.
QROPS Malta Pension Transfers for United Kingdom Expatriates
The UK and Malta have an enduring and reputable affiliation with the UK and as such are a trusted ally. Officially, Malta has two official languages, Maltese and English, with Maltese being the national language. In 1964 Malta gained its’ independence from the UK, later becoming a republic in 1974. Malta maintained its membership in the Commonwealth of Nations and is also a member of the United Nations and the European Union. Additionally, Malta is a member of the Eurozone and Schengen Agreement.
Why live or retire in Malta? Why should I transfer my pension to Malta?
Since December of 2009, QROPS Malta pensions have been available to British expats living both abroad and in Malta. Providing several benefits such as a stable economy, defined financial regulation, and competitive taxation, the financial centre is growing in popularity.
Like other offshore pension schemes, the Malta QROPS is governed by the same rules. In order to be included on the UK QROPS list, schemes must comply with the rules laid out by Inland Revenue.
HMRC provides the framework by which QROPS are managed. This leaves room for variations in the administration of QROPS schemes and the individual trustee determines the governing terms and conditions.
What is a QROPS Malta?
QROPS or Qualifying Recognized Overseas Pension Schemes enable you to transfer your pension offshore in order to reduce your tax liability. Simply put, you will not be required to pay UK taxes on your pension so long as you remain offshore and once 10 years has elapsed, the reporting requirements to HMRC cease.
What taxes do I pay in Malta?
Malta, already an attractive destination for British expats, is set to become even more attractive as new tax rules have been introduced to further improve an already favourable tax regime.
With no inheritance, wealth, or annual property taxes in place in Malta, British expats often venture there to both work and retire. Now, new changes have further relaxed income tax too.
Expatriates working in Malta will now be taxed at just 15 percent on all the income they derive from Malta, half as much as the earlier rate of 30 percent. Any income sourced from outside Malta is completely tax free, as are capital gains from outside Malta.
However, to qualify for this special rate expats must meet certain requirements.
The expat must not be a habitual resident or domiciled in Malta. Also, the expat must have professional qualifications or be highly skilled in specific sectors including: Chief Executive Officer, Chief Risk Officer, Chief Financial Officer, Chief Operations Officer, Chief Technology Officer, Chief Investment Officer, Portfolio Manager, Senior Trader/Trader, Senior Analyst (including Structuring Professional), Actuarial Professional, Chief Underwriting Officer, Chief Insurance Technical Officer, Head of Marketing, Head of Investor Relations.
The expat must also claim a salary of £75,000 or more.
For expats who want to retire in Malta there are different requirements/tax rates.
This means you could use a Malta QROPS or even an NZ QROPS for tax relief. In fact, oddly enough, if you are a resident in Malta and have an NZ QROPS, you are allowed to take 100% of any increase in your pension pot after transfer, which is not allowed in Malta. Although Malta does allow programmed withdrawals.
If you are an EU national who is not domiciled in Malta then you have free reign to retire there and enjoy very favourable tax rates. Any capital gains received will be remitted free from tax, meaning that if you retire with the intention of living off capital you can live completely tax free. There also special investment structures that can help you minimise tax. By utilising a QROPS pension transfer you will be able to claim your pension tax free as income is only taxed if it is remitted into Malta.
Should I Transfer My Pension to a QROPS in Malta
Who would a transfer to a QROPS in Malta suit?
If you are an EU resident, a QROPS in Malta would most likely be the best fit. You can transfer your pension into EUR and avoid all UK taxation. Then you just pay local income taxes in the country you live in. This is provided that the country you reside in has a Double Taxation Agreement with Malta. Malta has over 65 DTA’s presently. If you live in a country that does not have a DTA with Malta, your pension would be taxed at source in Malta.
The personal income tax would be between 15% and 35%. Furthermore each DTA is different and you need a QROPS Specialist or technical team to figure out what would be the best jurisdiction. You may find that a QROPS in New Zealand, Isle of Man or Gibraltar is a better fit.
Am I Required to Retire and Live in Malta?
Living in Malta is not a requirement, you are allowed to live anywhere outside of the UK. If you decide to return permanently to the UK, your pension will return to the UK Self Invested Personal Pension (SIPP) rules. While you remain outside of the UK, your QROPS will continue to grow UK tax free.
In order to get the lowest QROPS fees and figure out which jurisdiction will give your pension the result you want, you need to contact a QROPS specialist.
For enquiries, please send email to email@example.comQROPS Malta Pension Transfer for British Expats to Avoid Paying UK Taxes by Richard Malpass