What is QROPS?
QROPS (Qualifying Recognized Overseas Pension Scheme) is basically an overseas pension scheme for transferring your UK pension funds. It is authorized by the HMRC which has chalked out certain rules and regulations for the QROPS system. HMRC approves only the private pension schemes to be transferred to QROPS.
QROPS is a scheme through which you can take your pension funds outside the UK, in other words you get an escape from the UK’s tax regime. Not only this, QROPS also gives you an opportunity choose the tax jurisdiction you wish to follow.
Seeking Advice of A QROPS Specialist
However, this is not quite as a simple explanation as it may sound. You may face several difficulties while navigating through the process. Therefore, it is advisable that you consult a professional QROPS adviser who is trained on the topic and who can help you make critical decisions.
When you decide upon seeking the help of a QROPS adviser, you must make sure that you give them complete information, and do not leave any details out, however insignificant they may appear to you at the time. The adviser must know your retirement plans as well as the current arrangements and then critically analyse whether you should go for a QROPS transfer or not.
If you are currently following a final salary scheme for your UK pension funds, you may not be able to secure a better scheme through QROPS. While on the other hand, QROPS may be a more suitable option with standard defined contributions deals.
Make sure that your QROPS adviser has gone through all your legal documents and the rules and regulations of the pension scheme you are currently following so that he/she is in a better position to judge whether a QROPS system is desirable for you or not.
Important Rules to Remember
There are certain important rules that must be clear in your mind before you plan to get QROPS. Firstly, if you are seriously looking forward to the tax exemption you must not be a resident in the UK, only then you will be able to take advantage of this scheme. Secondly, the QROPS system that you choose must be approved by the authorities at HMRC.
Once these basic rules have been understood you can then move forward towards getting an excellent retirement plan with the peace of mind.