Once again, the leading UK based financial advisers on UK pension transfers overseas, Global QROPS Ltd, have been asked their opinion by the Financial Times.
As already established, QROPS in the Isle of Man underwent a major change, earlier this year, when the withholding tax on income paid from their QROPS scheme (at a rate of 20%) was withdrawn.
Further to this change, the Isle of Man has looked at the possibility to increase the tax free cash entitlement, to overseas residents who are members of their schemes – within the existing QROPS legislation.
Already in existence, on the Isle of Man QROPS, were rules allowing for a tax free cash lump sum at 30% of the QROPS fund value, for members at retirement – providing they have been outside of the UK for at least 5 complete UK tax years. This potential 30% was already more attractive than the 25% of the funds value available from a UK money purchase scheme and the 25% of the funds value available in some other QROPS jurisdictions.
In addition to the standard 30% tax free cash, Isle of Man QROPS are looking to pay tax free cash on any growth on top of the balance 70% of the UK pension fund initially transferred in. This option is only available after the 5 year QROPS reporting period. This has come into effect from 22nd October 2010.
Please see the link to the Financial Times article:
The expert team of advisers at Global QROPS Ltd will be happy to answer any further questions on this subject.