“The combined deficit of FTSE 350 companies with final salary pensions schemes breached £50bn at the end of January 2018”
Why would you look at moving your UK Pension?
As you have probably seen in the news almost daily for the past few years, UK Pensions are in a very unhealthy state. People are living longer, interest rates are at all time lows, and pension deficits are at all time highs.
These facts are creating the perfect storm and the result of this could eventually see your pension being reduced, delayed or in extreme cases see the your company pension go bust. This has already happened with BHS and Carillion, and the pension protect fund is already paying out pensions to over 100,000 people. To see a full list please visit the pensionprotectionfund.org.uk
The majority of large UK pension schemes are covered by the PPF (Pension Protection Fund), if you would like us to find out if yours is included, please contact us and state the name of your employer or pension administrator. Under the rules of the PPF, the amount you receive as a pension is capped, which means you may not receive the full amount of your pension that you were promised from your employer.
More and more expats are looking at taking control of their pension, and moving it to somewhere more secure, where they can choose their retirement age, take a lump sum, and have overall more flexibility. Expats can either move their pension to a QROPS, or a SIPPS.
Firstly, what is a QROPS?
A Qualifying Recognised Overseas Pension Scheme (QROPS) is an acronym used to describe any UK-recognised pension transfer scheme that is based outside of UK jurisdiction. Pension Schemes like this are very popular for expats – people living and working outside of the United Kingdom. There are numerous advantage of a QROPS, such as retiring early, passing on 100% of the pension to a beneficiary and significantly reducing the amount of UK tax payable.
Self-invested Personal Pensions
A Self-Invested Personal Pension (SIPP) is a UK government-approved personal pension scheme that gives you more control over how your contributions are invested, as well as greater flexibility into how much money you withdraw for your pension, as well as the age at which you can start making withdrawals. Its quite common for an expat to move several of their smaller pensions into a SIPP, or even move their final salary pension in to a SIPP to gain more control and take advantage of ‘enhanced transfer values’.
If you are unsure which is suitable for you, contact us now and an advisor in your region will be happy to help.
“According to mercer, the Brexit vote and corresponding sell-off in UK markets caused UK pension deficits to soar to a record £119bn”
