Blevins Franks .:.

RSS Feeds

Downloads

Audio Updates

Radio Broadcasts

Video Updates

Tax Planning

Moving Abroad

Investment Management

Asset Protection

Trustee

Retirement Planning

Pensions

QNUPS

QROPS

Foreign Exchange

Domicile Determination

UK Tax Residents Living Abroad

Tax Residency

Expatriates Returning To The UK

Home

Enquiry

Feedback

Extranet Client Login

RSS Feeds

Site Search

Qualifying Non-UK Pension Schemes (QNUPS)

NEW TAX PLANNING OPPORTUNITIES FOR BRITISH EXPATRIATES

On the 15th February 2010, a new UK HM Revenue & Customs (HMRC) statutory instrument came into force, which creates significant opportunities for British expatriates to save local taxes in the country in which they are tax resident as well as UK inheritance tax (IHT).

The UK legislation created a new type of trust known as Qualifying Non-UK Pension Schemes (QNUPS) - which should not be confused with Qualifying Recognised Overseas Pension Schemes (QROPS).

The tax rules for pension schemes are generally more favourable than other investment structures.

QNUPS allow retired expatriates to continue to put money into a pension scheme -

Firstly, there is no maximum age at which you can invest in a QNUPS.
Secondly, you do not need to have any earned income from an employment in order to make a contribution.
Thirdly, there is no maximum contribution that can be made into a QNUPS.

The rules are sufficiently flexible to allow someone who is 85 years of age and has been retired for 25 years to put large investments into a QNUPS and immediately create significant tax advantages for themselves.

The benefits of QNUPS for retired British expatriates

A QNUPS is a pension scheme trust and as such you are entitled to take a cash lump sum and income during your lifetime, with the remainder of your fund being able to be passed to your spouse or heirs on your death free from all taxes.

The following advantages are available to you through a QNUPS:

As a pension scheme, a QNUPS is very tax efficient in most countries as it can avoid both local wealth taxes during your lifetime and succession taxes on your death.
A QNUPS also avoids local succession law, so that you are free to choose exactly who inherits your money and in what shares.
Income can be taken from age 55 (after 6th April 2010) or it can be deferred as it does not need to be taken until age 75. In certain countries it can be paid in a manner where a significant portion can be paid to you tax free.
When income is taken it is drawn down from the fund, thus leaving your scheme assets invested. Otherwise the assets grow free from tax.
On death the value of the QNUPS will be exempt from UK inheritance tax and local succession taxes.
A QNUPS offers considerable investment flexibility and choice. Furthermore your assets can be invested and any benefits taken in a currency of your choice, giving you the opportunity to remove currency risk.
The trustees of a QNUPS have no reporting obligations to HMRC unless the scheme also holds any assets transferred from an authorised UK pension scheme. You can have both a QROPS and a QNUPS.

QNUPS and UK inheritance tax

A QNUPS will escape UK inheritance tax even if you a UK domicile. You do not have to wait seven years to avoid the tax or have to give the assets away, so you and your spouse/partner can continue to benefit from the assets.

With our UK and overseas taxation expertise and in depth knowledge of UK pension schemes we can help you use QNUPS to significantly improve your personal tax position on your investable wealth.

CONTACT US now to find out how much tax we can save you on your wealth and pensions.

Blevins Franks Financial Management Limited is authorised and regulated by the UK Financial Services Authority only for the conduct of investment and pension business. Blevins Franks Tax Limited is authorised and regulated by the Malta Financial Services Authority for the administration of trusts and companies. Blevins Franks Tax Advisory Service only gives taxation advice; all of the advisers are fully qualified tax advisers.