Did you know that HMRC has cut all Canadian QROPS?
In February 2017 Her Majestys Revenue and Customs (HMRC) decided to cut all Canadian QROPS / ROPS (Qualified/ Recognised Overseas Pensions Schemes) from the ROPS list.
The reasons being that Canadian retirement plans allow for the holder to use their pension as collateral when buying a house as well as having no age limitations. Meaning the holder can cash-in their pension at any age. UK regulations forbid a UK tax relieved pension, which is moved to a ROPS, to be used to purchase residential property or to be used as a loan, the Canadian system clearly goes against this.
Already moved to Canada?
If you’ve already made the move and transferred to a Canadian QROPS you may now face a tax charge of up to 55% when drawing down your pension. This is a significant portion of your hard-earned money.
As of February 2017, if you haven’t already moved your pension to a Canadian QROPS you no longer have the option to. Since they’re no longer supported by HMRC.
What can you do?
Whether you already hold a Canadian QROPS or are planning to move to Canada, you don’t need to worry about your UK pension. We have the solution to accessing your UK pension in Canada without facing huge taxes or draw-down fees. The answer is an International SIPP (Self Invested Personal Pension).
What is an International SIPP?
An International SIPP allows for the transfer and consolidation of UK pensions to a single personal pension structure. An International SIPP allows the holder to access their UK pension overseas, whilst remaining under UK regulation.
Some other key features of an International SIPP include: Consolidate several pensions into one place.
- Tax-free lump sum.
- Low-cost charging structure (from Harrison Brook).
- Full flexi access drawdown.
- Take control of your investments.
- Protected under UK regulations.
- Tax efficient saving.
Why move to an International SIPP
Other than an International SIPP offering the various benefits stated above it is the perfect place to hold your pension during these uncertain times concerning the strength of the British Pound.
An International SIPP gives you control over your pension monies currency and investment strategies whilst you wait for the Pound to strengthen against the Canadian Dollar.
Our fully qualified, market leading financial advisers are here to help. For any financial needs contact Harrison Brook today and receive free impartial advice.