QROPS Singapore Pension Transfer for British Expats and Singaporeans in the UK

QROPS Singapore. British Expats and Singaporeans Can Avoid UK Taxes on UK Pensions

British expats living in Singapore or wishing to retire in Singapore or Singaoporeans in the UK can now transfer their pension into a QROPS Singapore to maximize pension tax relief. British expats living or working in Singapore can take advantage of their offshore status and transfer their UK pension offshore to somewhere secure like Malta, NZ or Gibraltar and will no longer have to pay UK taxes on their pension if they stay offshore.

Singaporeans who have worked in the UK and have built up a substantial pension can also transfer their UK pension via a QROPS Singapore to avoid paying any more UK taxes. Singaporeans in the UK include people of Singaporean origin or descent, born or settled in the United Kingdom. More than 40,000 Singaporeans are born in the UK. Most live in the South of England. Singaporeans from the UK who wish to retire abroad can also move to a QROPS.

qrops singapore
QROPS Singapore Pension Transfer for British Expats

Why live or retire in Singapore as a British expat?

More than 56,000 Brits live and work in Singapore. Singapore had been a part of various local empires since it was first inhabited in the second century AD. It hosted a trading post of the East India Company in 1819 with permission from the Sultanate of Johor. The British obtained sovereignty over the island in 1824 and Singapore became one of the British Straits Settlements in 1826. Singapore was occupied by the Japanese in World War II.

Singapore declared independence, uniting with other former British territories to form Malaysia in 1963, although it was separated from Malaysia two years later. Since then it has had a massive increase in wealth, and is one of the Four Asian Tigers. Singapore is the world’s 4th leading financial centre, and its port is one of the five busiest ports in the world. The economy heavily depends on the industry and service sectors.

Singapore is a parliamentary republic with a Westminster system of unicameral parliamentary government. The legal system of Singapore has its foundations in the English common law system, but modifications have been made to it over the years, such as the removal of trial by jury. The People’s Action Party’s popular image is that of a strong, experienced and highly-qualified government, backed by a skilled Civil Service and an education system with an emphasis on achievement and meritocracy; but it is perceived by some voters, opposition critics and international observers as being authoritarian and too restrictive on individual freedom.

Some 5 million people live in Singapore, of which 2.91 million were born locally. Most are of Chinese, Malay or Indian descent. There are 4 official languages: English, Chinese, Malay and Tamil. One of the five founding members of the Association of South East Asian Nations, Singapore also hosts the APEC Secretariat, and is a member of the East Asia Summit, the Non-Aligned Movement, and the Commonwealth.

There is a healthy British community living in Singapore many working in the financial services industry. A low tax regime and proximity to other Asian beach destinations makes Singapore a popular place for British expats to work.

For the Brits living in Singapore, you can take advantage of your offshore address to reduce UK tax on your pension as well as protect your wife and children from high taxation should anything happen to you.

There was widespread mis-selling of QROPS in Singapore by local IFA’s, which led to QROPS in Singapore being closed down. This was due to local financial advisers selling the QROPS Singapore and then allowing 100% withdrawal from the pension as a lump sum. This is against the spirit of HMRC’s law governing QROPS, which are supposed to provide you with an income for life.

However, don’t worry, British expats in Singapore can still take advantage of QROPS Singapore by transferring into a scheme to Gibraltar, NZ or Malta. This will allow UK expats to avoid UK taxes on their pension. When it comes time to draw a pension, they can have this money paid directly into a Singapore bank account or an offshore account where they can use their ATM card to access their monies.

Benefits of a Singapore QROPS

What are the benefits of a QROPS Singapore 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 secure jurisdictions offshore for tax efficiency. Malta, NZ and Gibraltar all have a long standing reputation as financial centres in their own right. Both Malta and NZ are seen very much as onshore rather than offshore jurisdictions.

What is the Tax on a QROPS in Singapore?

Your QROPS, no matter what jurisdiction would avoid all UK taxes as long as you remained outside the UK. The taxes in Singapore and on your QROPS would depend on the 3rd party QROPS destination which you chose.

QROPS New Zealand for British Expats in Singapore

  • Avoids All Taxation
  • Currency choice of GBP, EUR or USD
  • 30% lump sum at 55 available
  • ‘100% of any increase in pension pot after transfer available as a further lump sum
  • 5 investment strategies available dependent on your risk profile

QROPS Malta for British Expats in Singapore

  • Avoids UK taxation
  • Income tax would be shared between Malta and Singapore
  • Currency choice of GBP, EUR or USD
  • 30% lump sum at 55 available
  • Programmed withdrawals allowed: 50% of any increase in your pension pot after transfer is available as lump sum withdrawals.
  • Much wider investment range allowed including shares, mutual funds, ETF’s, bond fund, hedge funds, high interest bank notes, etc.

QROPS Gibraltar for British Expats in Singapore

  • Avoids UK and Iraqi taxation
  • Flat 2.5% income tax rate at source in Gibraltar
  • Currency choice of GBP, EUR or USD
  • 30% lump sum at 55 available
  • 120% GAD rates allowed when drawing an income at retirement age
  • Much wider investment range allowed including shares, mutual funds, ETF’s, bond fund, hedge funds, high interest bank notes, etc.

QROPS Singapore Summary

For larger pensions, we recommend Malta QROPS which are slightly more expensive at around £800 – £1350 per year, but give you that freedom of investment. For smaller pension pots under around £70,000, a New Zealand QROPS may be better which have now seen the fees substantially drop. Of course there are always exceptions to this rule as each pension is different as well as each client’s risk profile. Email us for the latest fees and Singapore QROPS news updates.

Personal Income Tax in Singapore?

If you work in Singapore for more than 183 days, you are seen as tax resident.

As a resident:

  1. You will be taxed on all income earned in Singapore and any overseas income that was brought into Singapore prior to 01 Jan 2004.
  2. Your income, after deduction of tax reliefs, will be taxed at progressive resident rates.
  3. The foreign-sourced income (with the exception of those received through partnerships in Singapore) brought into Singapore on or after 01 Jan 2004 is tax exempt.

Overseas income derived outside Singapore, Singapore dividends and bank interest is tax exempt in Singapore. So, a pension income drawn from your QROPS would be a non-taxable event. If you are working in Singapore, the top marginal rate of tax is 20% and there are plenty of ways to reduce this tax through allowances and deductions. Click here for more information on Taxes in Singapore for British expats.

Here are the current personal income tax rates in Singapore 2012

Chargeable IncomeTax Rate %Gross Tax Payable S$
First $20,00000
Next $10,0002200
First $30,000200
Next $10,0003.50350
First $40,000550
Next $40,00072800
First $80,0003350
Next $40,00011.54600
First $120,0007950
Next $40,000156000
First $160,00013,950
Next $40,000176800
First $200,00020,750
Next $120,0001821,600
First $320,00042,350
Above $320,00020

What is a QROPS Singapore?

A Qualifying Recognized Overseas Pension Scheme (QROPS Singapore) 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. You can take the increased benefits, for example the 30% PCLS (Pension Commencement Lump Sum) instead of 25% in the UK, once you have been offshore for 5 years.

If you are living in Singapore at the moment, you can take advantage of your offshore address in order to move your UK pension into a QROPS Singapore to avoid further UK taxes down the line. A QROPS Singapore is an appropriate tax planning wrapper to avoid UK taxes if you are considering living or retiring abroad.

What Happens to My QROPS When I Leave Singapore?

Do I need to move my pension to Singapore?

No. There are no QROPS in Singapore anymore. Your pension can be transferred to a secure jurisdiction such as Malta, Gibraltar or NZ where it will be out of the UK tax system and your pension will grow tax free. Any taxes depend on the country you live in at the time of taking your pension benefits or income.

Do I need to live and retire in Singapore to get the Benefits from a QROPS?

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 Personal Pension (SIPP) rules, but you would be afforded time apportionment relief and you would have a smaller tax bill through taking some of your pension benefits whilst offshore.

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

QROPS Singapore article written by QROPS Specialists.

QROPS Singapore Pension Transfer for British Expats and Singaporeans in the UK by

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