UK Pension Transfers to QROPS Decrease Slightly

Transfers to qrops pension schemes have decreased by 10%

The volume of transfers from UK pension to overseas QROPS schemes fell by close to 10% between 2008 and 2010.

Billy Mackay, marketing director at AJ Bell, claimed that this change will not really effect transfers to Qrops schemes for individuals retiring overseas.

"The issue which clearly concerns the government is the promotion of Qrops as a tax avoidance vehicle to individuals who have little or no intention of leaving the UK."

He warned that the fall in the number of Qrops transfers provides evidence that changes to the UK pensions framework, such as the reduction in the tax charge applied on lump sum death benefits from the funds of individuals over 75 and the introduction of flexible drawdown, were already hitting the popularity of these transfers and this trend will continue.

Mr Mackay said: "We have also recently seen changes to the rules on disguised remuneration in EFRBS and the use of scheme pension to meet the minimum income requirement for flexible drawdown.

"All of these changes provide further evidence that the government is keen to support use of pensions in ways that remain consistent with the original intent of providing a secure income in retirement."

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