SIPPs remain one of the most flexible ways to manage UK pensions, but living abroad adds extra layers of risk and complexity. This guide explains how SIPPs and International SIPPs differ, how tax and currency exposure can affect your retirement income, and when it might make sense to transfer or consolidate existing pensions. It also includes practical guidance on avoiding pension scams and when to seek advice from a regulated UK specialist.
If you live outside the UK or are planning an international move, your existing or future pension arrangements will play a major role in securing long term financial stability.
A Self Invested Personal Pension (SIPP) is one of the most flexible UK pension options. However, for non-UK residents and expats, the risks, advantages and tax implications are very different from those faced by someone living permanently in the UK.
This guide explains how SIPPs work for people living abroad, the considerations that are often overlooked and how to decide whether a SIPP is suitable for your situation.
This guide is for general information only and does not represent personal financial advice. Pension planning for expats is complex and rules vary by jurisdiction. Always seek regulated advice before making decisions about your pension. We can arrange an introduction to a pension specialist.
A Self Invested Personal Pension is a UK pension with a wide investment choice. Unlike standard workplace pensions or personal pensions, SIPPs allow the holder to choose from a broad range of investments including:
SIPPs are regulated in the UK and managed by FCA authorised providers. They are normally suitable for people who want investment flexibility and are comfortable making active choices about their pension portfolio.
A SIPP is typically held with a UK provider who administers contributions, investment management and withdrawals. The underlying investments remain inside the pension wrapper until retirement age.
Contributions may be made directly or via transfers from previous UK pensions such as personal pensions, old workplace schemes or stakeholder pensions. Withdrawals can begin from age 55, increasing to age 57 from April 2028.
You can own a SIPP as a non-UK resident. However, your ability to contribute and receive UK tax relief is restricted.
You can normally only receive UK pension tax relief on contributions that are funded by relevant UK taxable earnings.
If you live overseas and do not have UK taxable income, your relief may be limited to the basic £3,600 gross contribution per year (£2,880 net). Many expats are not aware of this restriction and mistakenly assume they can contribute large sums tax efficiently while living abroad.
When you live outside the UK, currency exposure becomes one of the most significant financial risks within a SIPP.
Key considerations include:
Currency risk becomes even more relevant if you are planning multiple relocations or anticipate returning to the UK.
Tax is the area where expats encounter the most complexity. Understanding rights to UK tax versus local tax is essential.
You may be eligible for UK tax relief only if you have relevant UK earnings. Non-residents working abroad usually do not meet this criterion.
Withdrawals from a SIPP are normally taxable in the UK. Whether your country of residence has the right to tax those withdrawals depends on your tax treaty position. Some double tax treaties assign taxing rights to the country of residence while others assign them to the UK.
Local tax rules may treat pensions differently from UK rules, especially when it comes to lump sums.
Non-UK residents are not always entitled to the UK personal allowance. Eligibility varies and depends partly on nationality and double tax treaty interaction.
You can access your SIPP from age 55. There are three common methods:
Income is taken as needed and is taxable. Up to 25 per cent may be taken as tax free cash, subject to how your country of residence treats it.
Each payment includes a taxable and tax free portion under UK rules. Some countries tax the entire payment regardless of UK treatment.
A guaranteed income for life, though rarely chosen by expats due to lack of flexibility.
Costs of a SIPP
Typical costs include:
International withdrawals or currency conversions may incur additional charges.
SIPPs all fall under UK pension legislation, but the user experience differs significantly depending on whether the plan is designed for UK residents or for people living abroad.
A standard UK SIPP is built around the assumption that the holder lives in the UK, has a UK address and banks in GBP. For many expats, those assumptions do not align with reality.
International SIPPs evolved because many traditional UK SIPP providers struggle to service non-UK residents.
They remain UK-regulated pensions, but administration and support are tailored for expatriate circumstances. Providers typically offer support for non-UK addresses, multi-currency reporting and more practical processes for cross-border documentation.
A UK-only SIPP remains appropriate when you maintain strong ties to the UK or expect to return. An International SIPP becomes relevant when your situation is permanently global and you need a structure that accommodates multi-jurisdictional planning without friction.
SIPPs and ROPS/QROPS (Qualifying Recognised Overseas Pension Schemes) are often discussed together, but they serve different needs.
SIPPs may be more suitable when:
ROPS may be relevant when your long term residence is outside the UK and local taxation favours overseas schemes. However, ROPS often involve higher fees and more complex rules, and many expats have been mis-sold them.
A transfer can offer more control, but should always be driven by suitability, not pressure.
Transferring to a SIPP is often helpful when you have multiple pensions scattered across different providers, when your current scheme limits investment choice or when you need flexible drawdown.
An International SIPP becomes a practical option when your provider will not hold an overseas address, when your long-term retirement plan is outside the UK or when your financial life spans several currencies. It offers a smoother service model without changing the fundamental pension rules.
Transfers require caution, especially when your existing pension includes valuable guarantees or protected tax-free cash. A regulated adviser will assess whether the transfer genuinely benefits you or exposes you to unnecessary costs or risks.
Expat-focused pension scams often appear credible because fraudsters imitate the language of cross-border advice and exploit gaps in local regulation. They target uncertainty around residency, tax treaties and pension access.
A legitimate UK based adviser will be FCA-authorised, transparent about fees and clear about risks. They will not pressure you to act quickly or guarantee returns. However, non-UK based advisors are not regulated by the FCA, so spotting the warning signs is essential.
Warning signs include:
If something feels wrong, stop. Speak to a regulated UK pension specialist before moving money or signing paperwork. They may not be able to act on your behalf if you live abroad, but they will be able to check any advice you’ve received.
You should speak to a regulated specialist if:
We can provide an introduction to a pension specialist with experience assisting expats and non-residents.
