Post clampdown changes in the QROPS industry

Published:  25 Nov at 6 PM
Want to get involved? Become a Featured Expat and take our interview.
Become a Local Expert and contribute articles.
Get in touch today!
Although QROPs are still regarded as a good way to avoid expat currency exchange issues, there have been many changes since the 2012 clampdown by HMRC.

Experts in the field of QROPs are suggesting that the latest delisting of Malaysia and Bangladesh from the HMRC-approved countries list may be a hangover from the late 2012 policy shakedown. However, much has changed since then, although it’s not yet clear that investors have benefitted.

The 2012 new legislation put forward by HMRC saw pensions advisors given clear-cut product guidelines as to the exact nature of a QROPs. Requirements included non-residents and residents being treated the same for tax purposes, schemes being obliged to report benefits within 90 days in writing to HMRC, and a 70 per cent ring fence for retirement placed around the tax-free lump sum allowed.

After the changes were published, Guernsey delisted 300 of its QROPs and later pulled out of the scheme altogether. The loss of most of the island’s reservoir of knowledge and skill followed shortly and was a shock to Guernsey’s economy.

Jurisdictions including Gibraltar and Malta have, however, gone from strength to strength, with Malta the most popular choice. Overall, the market has improved its transparency as a result of the changes, giving good news to clients and providers alike.

However, any further abuse of the legislation surrounding QROPs will, no doubt, see HMRC hitting hard, a worrying thought even for advisers operating legally. The recent 2013 Finance Bill gave HMRC full permission to act against unlawful jurisdictions and illegal QROPs providers, and recent reports show the revenue department toughening reporting requirements in an effort to end pension-busting scams.
Like this news?

Comments » No published comments just yet for this article...

Feel free to have your say on this item. Go on... be the first!

Tell us Your Thoughts On This Piece:

Your Name *
Email * (not published, needs verification one time only)
Website
Type:
  • Facebook
  • Follow us on Twitter
  • RSS feed
  • Facebook

Latest Headlines

News Links

News Archive