subject: Qnups- What To Expect? [print this page] UK legislation laws and especially HMRC is continually working towards implementing ways to help people with their pension related funds. Working towards this direction, in February this year, a new regulation was brought out that would benefit people of British domicile living offshore. This law deals with UK inheritance tax differently. Called the QNUPS, this gives a lot of support to British expats, who up till now have been suffering a great deal as they were subjected to high taxes both in UK and the country of their residence.
The qualifying non UK pension schemes or QNUPS covers a wide variety of annuity schemes. As opposed to other schemes, under this scheme, there is more scope for other assets to be invested in the scheme. Its other advantageous feature is that you do not have to report to HMRC for the first 5 years, after which a retiree or annuity owner is allowed to make any amount of contribution to the scheme. Some even call it the UK IHT avoidance instrument. The QNUPS is available to all UK residents and non UK residents above the age of 18 with no maximum age limit.
Contributions can be made either from earned income or from personal assets. Even when it comes to restrictions as far as the kind of investment that can be made, there are very few negligible ones. The investments allowed include equities, bullion, bonds, gilts, property of any kind like residential property, fine wines, antiques etc.
Up to 25% of the QNUPS funds may be withdrawn which must be repaid prior to start of drawdown at a commercial rate of interest. The retirement benefits are available under QNUPS from early retirement age of 55 or normal retiring age of 65 and on death and permanent disability. However, a member must start drawing an income before he turns 75. The member also gets a cash lump sum benefit up to 25% of the fund value which, when paid in UK is tax free. The remaining funds get transferred to the heirs without any IHT being levied in the event of the death of the member. These funds may either be paid as a lump sum or used for paying a beneficiarys pension or even be held in a trust for transfer to prospective beneficiaries.
QNUPS is a positive scheme and encourages people to save. Available for both working as well as retired people, this scheme is a good way to help build a secure future.
