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Update: Please be aware that despite the Coronavirus (COVID-19) pandemic, we are operating as usual and our partners will be conducting initial consultations online and by telephone.

Can I transfer a QROPS back to the UK?

I am currently a UK resident and have been planning to retire in Spain for 10 years. I originally started my QROPS in 2010 and have been paying into it ever since, but due to recent health issues with my mother in the UK, I am having to change my plans and retire here to care for her. Can I transfer my pension back to the UK without suffering too many consequences?

Can I transfer a QROPS back to the UK?

A Qualifying Recognised Overseas Pension Schemes, or ‘QROPS’, can in fact be transferred back to the UK. The central thing to be aware of here is the tax liability that comes with staying in the UK, if you are to start to drawdown money from an offshore based QROPS. To clarify, you will be liable for taxation on the following, provided that you are a UK resident during either the tax year of the payment, during the previous five tax years, or if the payment was made on an investment in taxable property;

  • Smaller lump-sum payments
  • Serious-ill health lump sums paid to members 75 years and over
  • Any unauthorised payments
  • Certain lump sums that are paid following death of a member

Another option for someone who’s plans have significantly changed, is to repatriate your current QROPS to a UK scheme, such as a Self-Invested Personal Pension (SIPP). This is a great option for expats both returning to the UK, or that have invested in an offshore pension scheme. Transferring to a SIPP within the UK (from a QROPS) will allow you to reap many benefits. Not only will it make it much easier to withdraw and manage your cash in the future but will also avoid you having to follow any legal changes or future legislation in the QROPS scheme. It is also worth noting that a SIPP’s annual running cost is typically lower than a QROPS (however this is dependent on the size of the fund in question).

If this is something you would like more information on, to help decipher if your stay in the UK and transferring to a SIPP pension scheme is more suited to you, our comparison tables in the link below can help make this clearer.

https://www.expertsforexpats.com/expat-pensions/qrops-advice/qrops-vs-sipp/

If you have already moved back to the UK, or circumstances have caused you to stay and you are unsure on what you should do regarding your QROPS pension, we can connect you with one of our pension experts. This is to make sure that you are planning correctly, to provide a steady comfortable income for your retirement and to provide you with the reassurance you need for your future.

Remember, you must always seek financial advice before you make any decisions about your pensions, including whether to transfer your QROPS into the UK to ensure you are making the best decision you can.

Last updated: 3 April 2020