QROPS Substantial Changes

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Its likely Gibraltar Flexible Drawdown will be allowable by the end of 2017 with 20% tax at source.

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On 3/29/2017 at 4:29 PM, Maximus33 said:

Its likely Gibraltar Flexible Drawdown will be allowable by the end of 2017 with 20% tax at source.

Mike Ashton from Gib Govt has said they will have legislation in place by close March 31, very adjacent, I am watching


I know Mike he has personally helped me se we need to wait and see, he generally does what he promises


Tax rate who Knows !!


Remember individual schemes will also need to amend trust deeds etc

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Well, this has come as a bit of a surprise:

The jurisdiction’s new pension regulations, announced on Friday, followed “discussions with the UK authorities” in which it was decided not to introduce flexible access for Gibraltar Qrops. “Gibraltar will keep its current arrangements that require members of Qrops schemes to retain 70% of their total funds to provide a pension income for life. The rate of tax on pension benefits taken from these retained funds will continue to be levied at the current rate of 2.5%,” the government stated.

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I am currently in Hospital in Bangkok and have been out of touch for a couple of days, and will also be for the next week


This is a bombshell Gibraltar saying no flexible drawdown, there must maybe be deeper reasons because it will make Gibraltar uncompetitive in the world QROPS markets


I am not sure I believe this will be the situation longer term, I will try and ascertain more from my Gibraltar contacts


It further penalises expats further ( Frozen UK Govt pensions)


I believe there are ways to substantially increase the annual pension by using actuarial variations


If anyone wants help PM me as I do not wish to put on public forum,  a way to substantially bend the rules, otherwise this may be shut as well


Any help I offer is without any reward to me

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On 29/03/2017 at 4:29 PM, Maximus33 said:

Its likely Gibraltar Flexible Drawdown will be allowable by the end of 2017 with 20% tax at source.

Maximus I would be very interested to know the source of your information, it is possible you are better informed than most, many people will be concerned by the apparent NOT granting of flexible access by Gibraltar

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Concerned is a slight understatement  on my part! :hit-the-fan:

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 A further article on the Gibraltar decision to forgo giving flexi access option to Qrops. Looks like no turning back on their decision and they are more focused on EEA based clients.

“It has been confirmed that Gibraltar will be treated as a European Economic Area country in respect of the new transfer charge, which is positive, and so Gibraltar will be able to continue to offer QROPS to individuals living in the EEA subject to the new requirements.”

So, Gibraltar will not offer flexible access to QROPS pensions, but expats escape the transfer charge if they live in Europe, move their pension to Gibraltar and remain living in Europe for five years from the date of transfer.


So, maybe time to look at other options. Probably best to wait until after the dust settles and that could be post 18 April when the next Qrops list is published by HMRC. This will show which schemes qualify under the new rules.


Hong Kong might be an option. However whether flexible access option is available is uncertain, plus what issues may arise on transfers out of Gibraltar would need to be clarified as a transfer may not even be practical, e.g., possible tax charge if transfers made within a five year period, either from inception or, worse case, from recent change of rules. No doubt there are a number of other location options.

For example, Thailand and Hong Kong have a Double Taxation Agreement (DTA) whereas Thailand and Malta do not. This means that a QROPS Hong Kong gives the taxation rights to Hong Kong, so if you retire in Thailand, you will pay zero income tax on your pension as their is no income tax in Hong Kong on your pension.


The decision by Gibraltar was rather disappointing to say the least as all the signals were pointing to flexi-access being agreed with the only doubt being the drawdown tax rates. I, for one, was foolishly counting my chickens on this happening.:sad:   


This is the Gibraltar press release: Releases/204-2017.pdf


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This statement that at the moment Gibraltar is not agreeing flexible access, upsets me greatly, (I have a Gib QROPS but due to very serious  ill heath will be able to unlock my whole fund over the next 14 months, I have this in writing and pray it does not change)


I can maybe help increase your pension from Gibraltar, by using actuarial determination


I can see little benefit of a Gib QROPS, in some ways it is harsher than a UK SIPP


I believe what Gibraltar has done is pretty immoral, going against the UK easing of regulations, this I would expect in third world countries BUT not Gibraltar


Is Gibraltar now looking to line its own pockets at the expense of old and existing clients who have over the years provided them with good income, can they be trusted


I believe an action Group needs to be set up to challenge this decision


I know a lady leading an action group trying to help all those  with in Gibraltar who have lost their QROPS funds due to scammers, and I will talk to her


On a brighter Note I see the UK govt is around April 20 debating pension increases for those who at the moment do not get them, like people living in thailand


I urge you if you have a postal vote like I do, to lobby your UK MP in advance


As I often say I get no reward for help I offer and also seek no reward

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On another thread the following was posted that I believe may be misleading re QROPS


According to one source "the 70% rule for QROPS outside the European Economic Association are (sic) scrapped, which effectively extends flexible access to all the expat pensions".

It would be nice to see other sources confirming this.


What actually happened was the UK amended legislation to abolish the 70% rule, this does not mean all jurisdiction allow flexible drawdown, before it can be granted they have to amend their own laws and none have so I believe at the moment


Gibraltar has said it is not changing the 70% rule, so no flexible drawdown is available there , sad and unfair I believe but that the law in Gibraltar

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ID: 25   Posted

I have just succeeded in getting half of my QROPS paid to me and suffered only 2.5% income  tax, I have received the cash


I will get the remaining 50% in twelve months time


I have done this on the basis of ill health, NOT flexible drawdown which has yet to come to Gibraltar


I have fought this one for 9 mths where there is a will , there is a way,


Not only did the trustees agree but also GIB tax office and Gib Government as did UK HMRC QROPS Dept

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ID: 26   Posted (edited)

Was talking to my account manager in Gibraltar yesterday, flexible withdrawal is completely off the agenda there now it seems

Edited by poohy

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ID: 27   Posted (edited)

1 hour ago, poohy said:

Was talking to my account manager in Gibraltar yesterday, flexible withdrawal is completely off the agenda there now it seems

Post 16 maximus said he thought by the end of the year, I asked his source he never replied


Poohy you may be correct,iI also think Gibraltar may have sold individuals down the hole to protect their own business would greater payments help you, if so I have some ideas


Effectively what i did was use actuarial basis to increase frequency of my payments to two based on very bad medical reports,


With no flexible drawdown I bet little new business is being written


Poohy whats your age , if you have no other UK income then back to a sipp, and take £11,000 perannum under flexible income drawdown and no tax


Maybe you need a class action against the Gibraltar regulators, for discrimination despite UK relaxing the laws, that might just stir the pot sufficiently


I know a few gibraltar lawyers

Edited by al007

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ID: 28   Posted

Have also had recent discussions on the Gib flexi access possibilities and looks very much like being unlikely in the short/medium term They are too focused on the EEA issue so are throwing all others under the bus.


I am now looking at the Sipp route with, as noted, taking as much advantage of currently having no UK income. At least for this and next tax year. Probably delay my UK pension (luckily at the max level and due early next year) by a year or so, with advantage of two budget increases plus the delayed uplift, so no tax hit.


There are other tweaks that can also help. 


Just have to look at the costs of having both a Qrops + Sipp, plus what minimum is acceptable for setting up a Sipp.


That should be fine for me, short term. Then look at the Gib status in a couple of years.  

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ID: 29   Posted

I am a simple retired Chartered Accountant, I neither work nor seek work, however I have I believe a better knowledges of SIPP and QROPs than most financial advisers, I have also had both of these pensions, and there is no financial benefit to me giving incorrect advice unlike many advisers who may profit


I am always happy to help people and if anyone needs an unbiassed view I will willing give my phone number if you PM me , and I can help you with the questions for your financial adviser to answer


On SIPPs I do like and favor Hargreaves Lansdown, for self administered and low cost of running and set up, if you are considering a SIPP you need to do a 10 yr cash flow minimum of when you are in retirement, remember all drawdown will be subject to UK tax whether or not you live there, and agregated with the UK pension


Gib tax on drawdown is only 2.5 %

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BANGKOK 29 June 2017 14:34