A Guide To Accessing UK Pension Abroad
LEARNING OBJECTIVES
We provide high quality, relevant and up-to-date retirement advice to British Expats around the world.
IN THIS ARTICLE, YOU WILL LEARN THE FOLLOWING:
Taking benefits from a UK pension as an Expat
Important questions to ask your pension provider
The tax treatment of UK pension withdrawals
The differences between a QROPS and a SIPP
Your best options as an Expat
If you've recently moved abroad, or have been outside the UK for sometime and now looking at drawing down your UK pension benefits, you may be confused about your options.
In this article, we will run through the process of getting your UK pension income as an Expat, as well as the questions you'll need to ask your pension provider, along with reasons to consider a transfer to purpose built Expat pension account.
Taking Your UK Pension Benefits As An Expat
The first and most obvious point of call is contacting your existing UK pension scheme and requesting your pension benefits to be paid. This may be your initial 25% pension commencement lump sum, or perhaps a regular draw-down payment. If your provider allows this, then the process should be fairly simple and benefits will be paid to your account as per your request
Whilst some UK pension providers may allow you to do this as a non-UK resident, post Brexit, the vast majority of providers will only offer restricted access to European, US, Canadian and Australian residents.
Key Questions To Ask Your Pension Fund
Below is a list of important questions to regarding your UK pension pot:
Can I access my UK pension as a non-UK resident as and when I please, whether this is monthly or quarterly income payments?
Will I have to pay tax on withdrawals (i.e. will UK tax be deducted at source on my pension benefits)?
Can I continue to manage my investments in line with my financial plan, or can I no longer change the underlying investments of my retirement plans?
Do I need to buy an annuity?
Can I only take my pension as a one-off lump sum as an Expat?
Your Options | UK Pension Transfer Abroad
If the answers to any of the above questions are not satisfactory, or limit your freedom in retirement outside of the UK, then you should consider transferring to an Expat specific scheme, which are tailor made for non-UK residents, hence offering all of the benefits listed above.
There are 2 viable options for British Expats with respect to their pensions:
QROPS (Qualifying Recognised Overseas Pension Scheme)
The International SIPP (Non-Resident SIPP)
A QROPS pension is usually based in Malta, and takes your UK pension physically outside of the UK. The benefits of this include no UK tax deducted at source, a wide investment choice and multi-currency income payments.
The International SIPP keeps your money in the UK, and under the protection of the Financial Conduct Authority and Financial Services Compensation Scheme, however it grants certain benefits to Expats. These include flexible access income payments, a wide investment choice, full regulation, as well as being lower cost than a QROPS.
The best pension for you will depend entirely on your country of residence, objectives and attitude to risk. Typically speaking, the International SIPP is the most popular choice for Expats given the financial protection, but in certain circumstances a QROPS may be more appropriate.
Note, US residents and other jurisdictions outside of the European Economic Area can no longer benefit from QROPS accounts due to the overseas transfer charge, which levies a punitive tax on transfers abroad.
Expat Pension Management
The Wealth Genesis specialises in international pensions, and our independent, regulated and expert advice team have years of experience dealing with Expats from all walks of life.
With our unique flat-fee charging structure and industry leading annual management fee, our advisers can help your UK pensions deliver and work for you as you lead your life abroad.
To schedule a free initial consultation with a member of our team, use the diary below.
