The SIPP For Expats
LEARNING OBJECTIVES
We’re passionate about providing high quality, relevant and up-to-date retirement advice to British Expats around the world.
IN THIS ARTICLE, YOU WILL LEARN THE FOLLOWING:
How a SIPP works for Expats
Key benefits of transferring UK pensions to a SIPP
The limitations of retiring abroad with UK pension pots
Best practise when taking regulated financial advice
This article is intended for Non-UK residents who hold UK pension pots.
SIPP, or Self-Invested Personal Pension, is a type of UK pension scheme that enables you to invest, save, and grow a pot of money for your retirement. It allows you to have more control over your pension investments. SIPPs are popular if you reside in the UK because they offer flexibility in both investment options and draw-down.
Whilst a SIPP is for a UK resident, an international SIPP is for expats.
This guide aims to define what an International SIPP is, the benefits it can provide, and key areas to consider when selecting a SIPP as an expat.
What Is An International SIPP?
An International SIPP is a UK pension that has been specifically created for non-UK residents. The pension scheme remains in the UK and as such retains the protection of the UK regulators including; the FCA Financial Conduct Authority, Financial Services Compensation Scheme FSCS, and Pensions Regulator.
The rules and regulations of the pension mirror those of a standard SIPP giving you:
Access to a wide range of investments
Flexible draw-down access to your pension
Control over how your money is invested
At the same time, you gain benefits specific to your needs as a Non-UK resident.
International SIPP Benefits
Key benefits of iSIPPs for expats include:
Portability: You can transfer or consolidate one or more existing UK pensions into one account.
Currency flexibility: Invest and withdraw in all major currencies mitigating the currency risk of being invested in GBP and spending in your local currency.
Tax efficiency:
1) Transferring your existing pensions to an International SIPP is a non-taxable event no matter your country of residence.
2) Control how much and how often you take income, enabling you to not enter necessary income tax brackets. This can be regular income or lump sums.
3) Via an NT code, receive your pension income free of UK tax and subsequently declare to your local tax authorities. Mitigating the need to pay double tax and then reclaim it from HMRC.
Investment choices: Access a wider range of investments in multi-currency, including stocks, bonds, mutual funds, money market funds, and alternatives.
Best UK SIPP For Expats
Determining the best UK SIPP for expats is twofold.
Firstly, you need to consider your individual financial goals, investment preferences, residency status, and draw-down requirements.
Thereafter, assess the SIPP providers on areas such as costs, service, reputation, investment choice, service, and functionality.
International SIPP Providers
Whilst the international SIPP market is not as competitive as the onshore offering, it has dramatically improved over the last few years. With greater competition, prices have been reduced, service has improved and investment options have increased.
Before choosing a SIPP, we would consider factors such as account fees, investment options, currency conversion costs, tax implications, and regulatory considerations.
Best International SIPP Providers
The chart below shows a comparison of the existing best international SIPP providers.
Whilst cost and investment choice should always be a priority, service is often overlooked. Nothing is more frustrating than experiencing long delays when wanting to make changes to your portfolio or access your pension pot.
For those wanting to self-manage their pension fund, the options are limited. For expats who want to work with a financial adviser, the Novia Global UK SIPP is currently our recommended solution.
International Financial Advice
The Wealth Genesis is a fully regulated cross-border financial advice firm.
We help expats with their wealth management needs and implement a tailored investment strategy, rather than using generic, expensive, one-size-fits-all portfolios.
We provide both UK pension transfer advice as well as holistic expat financial planning.
By putting the client front and centre, we ensure long-lasting positive financial outcomes to secure your retirement abroad.
Contact us using the button below to discuss your needs with our regulated advice team.
FAQs
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We charge a flat fee of £3000 and an annual management fee of 0.85%. This covers transferring one or consolidating many pensions. It includes recommending the best international SIPP, investment platform, and fund range based on your risk tolerance, requirements, and objectives.
As part of our service charter, we hold quarterly reviews with all clients to ensure the portfolio stays aligned with their needs.
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Our primary business revolves around customer retention and our ongoing management fee, which allows us to dedicate more time to every client.
By embracing and incorporating technology into our administrative and investment processes, we can reduce costs which we pass directly back to our clients.
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The majority of financial advisers use risk-graded model portfolios called Discretionary Fund Managers DFMs. Whilst they can offer good protection through extensive diversification (up to 20 funds). They are expensive (between 0.15% and 0.35% additional fees) as this is on top of your adviser and product costs. High ongoing costs act as a guaranteed drag on performance over the long term, and the majority of ‘model portfolios’ under-perform low-cost index tracking funds.
We select the fund range based on your specific requirements and risk tolerance. Our portfolio recommendations have an emphasis on time-proven investments with strong performance relative to their benchmarks. We aim to keep the total cost of our portfolios as low as possible, without sacrificing performance or diversification.
Once we have established your investment goals and risk tolerance we will recommend a fund range bespoke to you.
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Never.
Both ourselves and the products used will never have a fee to leave or an exit penalty.
