September 22, 2008
HMRC has issued a position statement regarding the current regulations affecting QROPS transfers.
This HMRC statement is a reminder that ‘unauthorized payments’ are subject to unauthorized charges and penalties.
If at any time an overseas pension scheme is not satisfying the conditions for recognition as a QROPS scheme the HMRC statement makes it clear that at the very least:
‘any transfer that has been made to that scheme could potentially give rise to an unauthorized payments charge liability for the member’.
It has always been the position of the QROPS Bureau that the only appropriate QROPS schemes for expats are those that comply with both the spirit and the letter of UK QROPS regulations.
In view of this HMRC position statement we would strongly urge those considering a QROPS transfer to proceed with caution and prudence in selecting their QROPS scheme, particularly where the overseas scheme seems to be more ‘generous’ than is either allowed or intended under UK QROPS regulations.