Qnups What Every Investor Should Know

QNUPS is a scheme introduced by the HMRC in 2010 that permits investments made in

certain offshore funds to be free from taxation under the Inheritance Laws. Any individual can transfer his assets to such a scheme to avoid his heirs being subjected to IHT upon his death.

QNUPS is a relatively new scheme introduced by the HMRC under the IHT regulations in February 2010. It allows an individual domiciled in the UK to transfer his pension or assets to a qualifying offshore scheme to avoid his family having to pay Inheritance Tax on the assets after his death. In addition, the investment can be made in several countries worldwide where the person plans to settle after his retirement. This includes countries with which the UK Government does not have double taxation agreements. Here are some commonly asked FAQs that every investor should know.

What assets can be transferred to QNUPS?

An individual can choose to transfer into this scheme any asset that the wants to save from Inheritance Tax. This can include his pension, residential property and even other assets of an unconventional nature such as old wine or antiques.

Is there a restriction on the amount that can be invested in these schemes?

There is no maximum limit for investment in these schemes. A person can choose to invest any amount that he wants. In addition, there is also no restriction on the type of income that has to be invested. It does not have to be only income from employment as is the case with other pensions. Therefore, individuals who get income from sources other than employment such as gifts or inheritances can transfer such funds into these offshore schemes to protect them from tax on inheritance.

Is there a time period within which the transfer has to be made into QNUPS?

There is no restriction on the time within which funds have to be transferred into these schemes. In fact, a person can also transfer his assets after retirement. This benefits families these days where there is more than one generation who is retired. If the older family member passes away after leaving his funds in a QNUPS scheme, the retired inheritor would not be liable to pay any IHT on his inheritance.

Will tax be levied if the individual relocates to the UK a few years after he retires?

No. Unlike any other overseas schemes, there is no restriction on the number of years that an individual has to reside outside the UK after he retires so as not to be taxed upon his return. With QNUPS, a person can choose to return whenever he likes and still avoid taxation. This does away with the need to change Domicile from the UK or transfer assets before death in order to avoid taxation.

by: QROPS

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