subject: Qrops Pension Which Provider To Choose [print this page] When a UK citizen wants to transfer his pension to a QROPS pension scheme overseas, the first step he should take is to get the advice of a QROPS adviser who will contact the current pension provider to initiate the transfer request. The pension providers on their part will then verify if the QROPS scheme is on Her Majestys Revenue & Customs (HMRC) list of approved QROPS providers in the country of transfer.
Why is it important to verify if the QROPS pension scheme is on the HMRC list? The HMRC lays down a set of requirements that need to be complied with for a pension provider to be on the approved list. Usually the overseas scheme needs to be regulated under the laws of the country in which it exists and needs to be recognized for purposes of taxation. The providers send in the required information to HMRC to be listed.
However, a point to be noted here is that inclusion in the list does not necessarily mean that the overseas scheme is reliable and of a certain standard. HMRC updates the list twice a month after scrutinizing the applications of various QROPS pension schemes from countries across the globe. If on scrutiny they find that a particular scheme does not meet the criteria for earning recognition, then such a scheme will be removed from the list.
You can find a comprehensive list of the various QROPS pension schemes that are on the HMRC list on the QROPS website. This listing includes the name of the fund and the country of its location, helping you shortlist a few schemes that you might consider suitable. However, it is advisable not to take any steps to initiate the transfer before verification, as quite often if a scheme gets subsequently derecognized due to its failure to comply with HMRC requirements, you would become liable to pay a surcharge for transferring funds to an unauthorized scheme.
So how do you save yourself the trouble of paying surcharges for transferring your life savings? It is best to hire the services of a QROPS adviser who is licensed by the UK Financial Service Authority, as he would be experienced in the legalities and procedures involved. Arrange a meeting with your adviser to get a better understanding about the QROPS jurisdiction in the country where you propose to transfer your funds. If you are unsure about which QROPS Pension scheme to move your funds to, get the adviser to explain the pros and cons of each scheme to you.
