UK Pension QROPS

UK Pension QROPS

***Important Update***

As of February 15 2017, there is no financial institution in Canada authorized to accept a UK pension transfer.  All previously approved Canadian institutions have been removed from the HMRC QROPS list.  We expect this to be a temporary setback.  Canada as a QROPS country is under full review and hopefully in a few months a few institutions will be added back to the list.


Are you a UK expat looking for a Canadian UK Pension Transfer Expert?

With our team of pension transfer experts located here and the UK, we have the in-depth knowledge and expertise to handle even the most complex UK pension transfers.

Canadian permanent residents or citizens can move any UK Retained Pension Benefits to Canada.

Retained Pension Benefits are Defined Benefit Pension Plans, Private Company Schemes, Personal Pensions, Stakeholder Pensions and Contracted out State Pensions previously SERPS but EXCLUDES British State Pension.

The State pension is not funded and cannot be transferred. However, your British Pension can be collected while living in Canada.

Your private pensions can only be transferred tax-free to a registered plan which is recognized by HMRC as a Qualifying Recognized Overseas Pension Scheme (QROPS).

How to transfer you UK pensions to Canada.

A Canadian financial institution must apply to have QROPS status. QROPS Status is granted and is constantly under review. There are significant differences between Canadian QROPS and specialist expertise is required to recommend the best QROPS for you.

With both presence in Canada & the UK, we offer a definite advantage over other Canadian Financial advisors. Any complex transfers will be reviewed and followed up by our UK contact at no additional cost to you.

The advantages

1. Access

Canadian pensions offer a greater flexibility than their British counterparts; Canadian Registered Retirement Savings Plans (RRSPs) allow clients to flexibility for withdrawals (though strict rules apply to meet the UK “Pension Age Test” usually age 55).

Consult our full QROPS info blog for more information.

2. Reduce Currency Market Risk and currency exchange fees

For your retirement income in Canada you will need Canadian dollars. Transferring your pension to Canada will enable you to have your retirement benefit invested in Canadian dollars. You will no longer be exposed to currency fluctuations. You will also avoid ongoing currency exchange fees.

3. Organization and Planning

You may have more than one pension plan in the UK. When you transfer them they can all go into the same QROPS. Having all your resources in Canada will help simplify your cash flow and help you manage your retirement funds more effectively.

4. Protect Beneficiaries

The Canadian pension system is very different from the UK and can offer substantial advantages to protect your beneficiaries. In Canada your surviving spouse receives 100% of your transferred retirement fund and if there is no surviving spouse, your children or other beneficiaries receive the full after-tax value. In the UK death benefits vary and depend on the type of pension you have.

The UK Government may eliminate QROPS in the future.

Prime Minister David Cameron quietly said that he is concerned about the rate of “outflows” of money from the UK. This may be an indication that QROPS arrangements may be on his Government agenda.

Read more here on the recent changes to UK pensions

QROPS – Qualifying Recognized Overseas Pension Scheme rules

It is imperative that you know the rules surrounding QROPS specifically regarding the withdrawals of these funds. The QROPS manager has an obligation to report withdrawals within 10 years of the transfer. The new “Pension Age Test” must also be met to avoid UK tax penalties. The new rules are meant to ensure that the funds are used for retirement purposes for the most part, as intended in the first place.

Here is an article from the Telegraph on the subject of QROPS.

And a recent one on the potential changes to the 70% rule.

HMRC demands penalty payment to those who redeemed before age 55

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Contact us today to understand if a UK pension transfer makes sense for you.