QROPS is the abbreviated term for ‘Qualifying Recognised Overseas Pension Scheme’. This is a popular overseas pension scheme because it adheres to the regulations that have been put into place by UK law. Consequently, this is the ideal option for anyone who has retired outside of the UK or is looking to do so in the future. So, if you have moved to the US from the UK, this information could be helpful for you. It is more than likely that you will be able to transfer your current pension to a QROPS.
It is highly recommended that you take this opportunity for various reasons. Let’s take a look at the benefits of this pension scheme and thus why you should definitely consider a QROPS…
• Reduce your income tax – A QROPS can present you with a fantastic opportunity to minimize the amount of income tax you pay. After all, there is certainly nobody who enjoys giving their hard-earned cash to the taxman! Your current UK pension is taxed at a high rate because the provider has to take tax at rates relevant to the UK. However, once you transfer your pension it will then be taxed at the country in which you are now based. Therefore, if the country boasts a lower tax rate you will have the perfect opportunity to reduce the amount you pay. Considering the high rates in the UK, this is more than likely.
• Investment freedom – Another key reason why you should go for this UK pension transfer is that you will benefit from a much better selection of investment opportunities, including the opportunity to buy snapchat shares. Of course, this all depends on the scheme you choose. Nonetheless, the degree of investment flexibility is massive, and therefore it is worth considering the help of an investment advisor to really ensure you maximize your potential with a Qualifying Recognised Overseas Pension Scheme.
• Eradicate charges on death – If your pension is based in the UK you are going to suffer at the hands of extensive charges once you pass away, even if your loved one files with a wrongful death attorney. There is a 55 percent charge on your pension which means that less than half of your pension is going to be left to your other half or whoever your beneficiaries may be. However, you don’t need to worry about this with a QROPS because one hundred percent of your pension will be available to your beneficiaries.
• Tax-free cash – Depending on where you have moved to, your QROPS can present you with the opportunity to maximize your tax-free cash. Again, this all depends on the rules that are in place in relation to your new jurisdiction. Nonetheless, most of the time you are presented with the opportunity to increase the level of tax-free cash you can receive.
It is not hard to see why a QROPS is so beneficial. If you are moving away from the UK, or already have moved here from the UK, this is definitely something you should carefully consider. If you are unsure regarding how to go about it then you should seek professional aid. There are lots of financial advisors who will give you the help you need and ensure your pension transfer is a success.