QROPS

QROPS Pension Transfer for British Expats in Shanghai


Shanghai QROPS. UK Pension Transfers for British Expats in Shanghai

British expats in Shanghai or wishing to retire in Shanghai, China can now transfer their pension into a QROPS Shanghai to maximize pension tax relief. British expats living or working in Shanghai 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. China is destined to be the world’s largest economy by 2020. Its financial centre in Shanghai and cultural centre in Beijing is destined to attract more Brits to work there.

Anyone in Shanghai working for a British company or any Chinese or British Chinese who have worked in the UK and built up a substantial pension can also transfer their pensions offshore to avoid UK income taxes.

More than 36,000 Brits live in China at the moment and is growing rapidly.

Shanghai has a big British expat community. If you are from Shanghai and worked in the UK and accrued a pension, you can also transfer your pension out of the British tax system. UK born residents in Shanghai, British expats in Shanghai and Brits considering retiring in Shanghai can transfer their existing pensions offshore to get out of the UK tax net.

QROPS Specialists can also help set up new offshore pension schemes which can grow tax free. Whilst in the UK, usually your company and the government pay into your pension scheme. This is not always the case when you leave home. We can help set up a tax-free offshore pension to protect your future.

Benefits of a QROPS Pension Transfers for British Expatriates in Shanghai.

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

• Avoid UK income tax
• Avoid UK dividends tax
• Avoid UK capital gains tax (CGT)
• Avoid 55% tax upon death whilst in drawdown in the UK

• 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 which was formerly under the protection of the British Crown, but has its own strong financial regulations which are tax efficient

What is a Shanghai QROPS?

A Qualifying Recognized Overseas Pension Scheme (QROPS Shanghai) 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 10 years after the pension transfer, the reporting requirements to HMRC cease.

If you are living in Shanghai, China 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. Many British expatriates in Shanghai are taking advantage of a QROPS To avoid UK taxation, however it is not for everyone and you will need to send your pension in for a transfer analysis and a suitability report.

What Taxes Do I Pay on My QROPS in Shanghai

Personal Income Taxes in Shanghai

British expatriates in Shanghai pay worldwide income taxes only if they have stayed their for five years or longer.

The tax on an individual’s income is progressive. From 2013, an individual’s income is taxed progressively at between 3% – 45%.

Tax %      Monthly Income (CNY)
3%            1 – 1,500
10%          1,501-4,500
20%         4,501-9,000
25%         9,001-35,000
30%         35,001-55,000
35%         55,001 – 80,000
45%         80,001 and above

What Taxes Do I Pay on My Pension in China?

So, tax on a QROPS will take place if you have been resident in China for five years at the rates shown above upon receipt of your pension in China.

Click here for more on deductions and Chinese tax rates.

Do I Move My UK Pension to a QROPS in Shanghai?

Do I need to move my pension to Shanghai, China?
No. Your pension can be transferred to Malta where it will be out of the UK tax system. Malta has a Double Taxation Agreement with China meaning your pension will be paid out gross, free from tax in Malta. You then pay Chinese taxes when you remit your pension to a Chinese bank account. You can also opt to have your pension paid into an offshore account.
Do I need to live and retire in Shanghai, China?
As long as you live outside the UK, e.g. in Shanghai or elsewhere in China or offshore, you can move your pension to a secure jurisdiction such as Malta. Once the pension is transferred, you can live or retire anywhere outside the UK to receive the preferential tax treatment. It will avoid all UK taxes and capital gains tax, but the income tax would depend on the country you live in at retirement when you decide to take an income and if it has a Double Taxation Agreement with the QROPS jurisdiction. Please send us you the transfer value for your current pension(s), so we can make a suitability report.

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

QROPS Shanghai article written by QROPS Specialists.

QROPS Pension Transfer for British Expats in Shanghai by

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