QROPS

[inca]

On the subjest of QROPS my father has a frozen UK pension, and is a none resident UK taxpayer, resident in Spain, he has been advised that the best option is to QROPS the pension into an offshore facility located in Guernsey, and that 5 years from 'uplift' he will be able to draw income in line with UK annuity rates, the huge bonus being that any capital remaining after death transfers to his chosen beneficiaries, is anyone aware of the scheme, and any advise on potential pitfalls for a QROPS and a TAX perspective? are there other alternatives?

[Loza]

The big attraction with QROPS is being able to pass on the fund at death and avoid the 82% tax charge.
The worry is that (to me at least) HMRC do not give a green light to make what would otherwise be unauthorised payments after five years non residence, they simply state that such events do not need to be reported.
Given the current move towards retrospective legislation (Gains Cooper/ Huitson) I think this is risky, It may be that given the size of the tax charge it may be worth a punt in some circumstances.
I have client in this position and I would not advise a QROP

[atwood]

Afternoon,

I'm aware of most of the QROP products on the market. There is some real rubbish out there being sold by individuals with little tax knowledge which is a bit of a worry.

However, in the right situations (such as genuine emigration) and for the right people, QROPs will have some mileage.

Assuming your father is not UK resident in any of the previous 5 years, then, say on death, a capital balance can potentially be paid to beneficiairies without an unauthorsised payment charge and without IHT (ie removes the 82% hit.)

Your father does need to bear in mind what would happen if he returned to the UK.

Let me know if you have any queries

Kind regards
Andy

atwtaxation@googlemail.com