QROPS Pakistan. Pension Tax Relief
British expats living in Pakistan or wishing to retire in Pakistan can now transfer their pension into a QROPS Pakistan to maximize pension tax relief. British expats living or working in Pakistan can take advantage of their offshore status and transfer their UK pension offshore to somewhere secure like Malta or New Zealand and will no longer have to pay UK taxes on their pension if they stay offshore.
If you are from Pakistan and have worked in the UK and built up a substantial pension, you can also transfer to a QROPS Pakistan to avoid UK taxes.
Pakistan’s history has been characterized by periods of military rule, political instability and conflicts with neighbouring India. The country faces challenging problems including terrorism, poverty, illiteracy and corruption.
Pakistan has the 7th largest standing armed force and is the only Muslim-majority nation to possess nuclear weapons. It is designated as a major non-NATO ally of the United States and a strategic ally of China. It is a founding member of the Organisation of the Islamic Conference (now the Organisation of Islamic Cooperation) and a member of the United Nations, Commonwealth of Nations, ‘Next 11 Emerging Economies’ and the G20 developing nations.
Why live and work in Pakistan?
Over 50,000 Brits work and live in Pakistan. Pakistan gained independence from the British Empire in 1947 after a struggle for independence. Pakistani society is largely hierarchical, with high regard for traditional Islamic values, although urban families have grown into a nuclear family system because of the socio-economic constraints imposed by the traditional joint family system.
The variety of Pakistani music ranges from diverse provincial folk music and traditional styles such as Qawwali and Ghazal Gayaki to modern forms fusing traditional and western music, such as the synchronisation of Qawwali and western music by the world renowned Nusrat Fateh Ali Khan.
Known for its richness and flavour, Pakistani cuisine is a blend of cooking traditions from regions of the subcontinent. Although there are great variations from one area to another, dishes from Sindh province, and the Punjab region are identical to north Indian cuisine due to the strong similarity of culture and ethnicity. These can be highly seasoned and very spicy.
Field hockey and cricket are the national sports.
Benefits of a QROPS Pakistan
What are the benefits of a QROPS Pakistan 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: The pension is held in a secure jurisdiction such as Malta or New Zealand.
What is QROPS Pakistan?
A Qualifying Recognized Overseas Pension Scheme (QROPS Pakistan) 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 10 years of living offshore, the reporting requirements to HMRC cease.
If you are living in Pakistan at the moment, you can take advantage of your offshore address in order to move your UK pension into a QROPS to avoid further UK taxes down the line. A QROPS is an HMRC approved tax-planning vehicle to avoid UK taxes if you are considering living or retiring abroad.
Today, Pakistan is regarded as to having the second largest economy in South Asia.
What is the economy like in Pakistan?
The structure of the Pakistani economy has changed from a mainly agricultural base to a strong service base. Agriculture now only accounts for roughly 20% of the GDP, while the service sector accounts for 53% of the GDP. Significant foreign investments have been made in several areas including telecommunications, real estate and energy. Other important industries include apparel and textiles (accounting for nearly 60% of exports), food processing, chemicals manufacture, and the iron and steel industries. Pakistan’s exports in 2008 amounted to $20.62 billion (USD). Pakistan is a rapidly developing country.
The economy is estimated to grow by 2.8% in 2011 and the GDP per capita – PPP is $2,851 International Dollars (2008 estimate).
QROPS Pakistan. Providers
Do I need to move my pension to Pakistan?
No. In fact, there are no QROPS providers in Pakistan. Your pension can be transferred to a secure jurisdiction such as NZ or Malta where it will be out of the UK tax system and your pension will be paid gross and grow tax free.
Do I need to live and retire in Pakistan?
No, you can live anywhere offshore. As long as you are outside the UK, your QROPS will grow free of UK tax. If you ever return to live permanently in the UK, your pension will simply return to UK Self Invested Pension Plan (SIPP) rules.
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QROPS Pakistan article written by QROPS Specialists.QROPS Pakistan Pension Transfer for British Expats and British Pakistanis Returning to Pakistan by Richard Malpass