Criteria to qualify QROPS?

QROPS or Qualifying Recognized Overseas Pension Scheme is an overseas pension scheme that gives excellent retirement planning benefits. Its flexible and easily accessible.To avail these advantages you have to qualify some criteria.

Let’s see what the criteria are:

• First if you are residing abroad and holding a UK pension scheme, or you are intending to shift in the next 1 year, you are qualified to transfer your existing pension into an HMRC approved QROPS pension scheme.

• You must be a non-UK tax resident for 5 tax years. The tax year is not a calendar year.  A tax year runs from 6 April present year to 5 April next year. You can either plan to be out of the UK or already residing outside UK, for more than 5 yrs.

• If you relocate to become a non-UK tax resident within the next 12 months, the reason must be for a settled purpose i.e. retirement or employment.

• You can transfer any pension arrangement into QROPS provided no annuity is taken against pension.

• It will be ideal for you when you have 5 yrs in hand before retirement.

• If you are looking to avoid or reduce the income tax payable from your pension QROPS is ideal for you.

• In most situations a non UK resident intend to remain so, can transfer UK pension offshore through a QROPS pension transfer. In that case you will get fairly larger benefits.

• Some older pensions do not enjoy benefits on transfer because these plans have annuities with high interest. You can take advice from a pension professional to know your transfer benefits.

Be careful enough about the legal and administrative fees involving in QROPS. Volatile markets make your investment risky. So go for a technical analysis before investing in particular sector.

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