Can you transfer a UK pension to Poland?

For many Poles who have returned home after living in the UK, one of the big questions involves what to do with any UK pension benefits that have been accumulated while away.

This dilemma is even more pertinent in the light of Brexit and the additional uncertainty that it brings to the table. Continue reading “Can you transfer a UK pension to Poland?”

Should you access your pension tax free cash?

Today’s question is ‘should you access the tax free part of your pension fund?’

A few caveats to begin with.

Firstly, tax free cash (TFC) can also be known as a pension commencement lump sum (PCLS). I generally prefer the second term as the payment may not actually be tax free. Continue reading “Should you access your pension tax free cash?”

How the Overseas Transfer Charge affects a QROPS transfer

If you are considering transferring your UK pension funds to a QROPS, you must remember that you may be subject to the Overseas Transfer Charge (OTC) not only at the time of transfer but also, potentially, in the future.

What is the OTC?

The Overseas Transfer Charge came into effect from 9th March 2017 and applies to most QROPS transfers (there are special circumstances where such transfers are exempt, see below).

It is charged at 25% of the transferred value.

The charge is automatically deducted by the QROPS manager from your fund and transferred to HMRC.

The tax is applicable to transfers into a QROPS, whether the source is a registered UK pension scheme, another QROPS or a scheme that once qualified as a QROPS.

It is not applicable to transfers that were requested before 9 March 2017, nor is it applicable to funds derived from UK pension transfers to QROPS before 9 March 2017.

It is also not applicable to transfers to another UK registered pension scheme, e.g. a SIPP (Self Invested Personal Pension).

When is the OTC not payable?

There are a few scenarios where the OTC is not payable. However, for the purpose of this post, the most relevant is when the funds are being transferred to a QROPS that is established in a country within the European Economic Area (EEA) and the member is also a resident in a country within the EEA.

For example if the QROPS is established  in Malta and the individual is resident here in Poland, then the OTC would not apply at the time of transfer.

What happens if my circumstances change?

However, if your circumstances change within the first five full tax years (6th April to 5th April) after a QROPS transfer has taken place, then a transfer that was not subject to an OTC at the time of transfer could become fully chargeable.

For example, if within five years you move from Poland to another country that is not in the EEA, then the OTC will then be payable.

Future QROPS Changes

Legislation around QROPS transfers is constantly changing; the Overseas Transfer Charge outlined above was introduced with 24 hours notice.

Want to know more? Book a free 15 minute discovery call.

Truffle trees and Brazilian teak plantations

There was a story on the BBC website last week about a couple who invested their pension fund in a firm producing truffle trees. Not surprisingly, the story didn’t end happily.

It reminded me of a similar incident involving the equally exotic Quadris Environmental Forestry Fund.

Continue reading “Truffle trees and Brazilian teak plantations”