Do you have a plan to move from the UK and live in another country? Or do you used to work in the UK, but now you have to relocate abroad? You might be worried about managing the pension funds you have collected all these years. Should you withdraw all the money? Or is it possible to switch your pension pot to a scheme that is valid in your destination country? You can leave your retirement savings in the UK while you are living abroad or you can move your pension to an overseas scheme with QROPS pension transfer. Here are some important things to consider before moving UK pensions overseas.
Fees
Whether you leave your funds in the UK investment account or you will take them along with you, you must be aware of the fees that you have to pay. If you already gather all the required information, then you can evaluate both choices, which one suits your profile risk and meets your needs. Both conventional and digital platforms of saving accounts apply charges to their customers. Therefore, you should carefully check what kind of charges they add to your UK pension and how many fees you should pay for the management of the overseas scheme.
Tax Regulation
The governments of each countries have set specific policies and regulations regarding how much you will be charged for tax when you wish to withdraw your funds from your retirement account. Not only have they prepared for that matter, but moving your funds to a QROPS may also be eligible for a tax deduction. Not all transfers will be charged with tax, some transactions may not require you to pay for it, for example:
- You are a citizen of the destination country where you are switching to a QROPS.
- You are a citizen of a European Economic Area (EEA) country, and the QROPS you are moving to is located in another EEA country or Gibraltar.
- Your employer who supported your funds pays for the QROPS you will use.
If you don’t have the proper documents of the pension plan from which you are switching to QROPS, it should cost 25% of the total amount you transfer to your overseas account.
Pension Scheme Features
When you are moving your retirement fund to QROPS, be sure to fully comprehend the new scheme specifications and benefits. What kind of features do they offer? Is it different from your previous retirement account? It is in your best interest to look for a new pension scheme that will give you more advantages than your current plan.
Currency Value
Transferring your retirement funds abroad equally means that you should be prepared for the currency risk and exchange commissions.
Those are some things that should be considered when you want to move your funds. Before you make your decision you can discuss your situation and get the best advice from a pension transfer specialist. With careful consideration, you can grow your funds and gain bigger returns for your pension.