In this article we lay out when and when not people should be considering a QROPS. QROPS can be really good for certain people and so we wanted to talk about the RL360 QROPS investment.
To do this we need to allow you to see an example. Someone aged around 54 with a fund of less than £500,000 who lives in a jurisdiction where a UK pension would be taxed twice. They intend to retire at age 60 and move back to UK or possibly somewhere in the EU. Should they consider aRL360 qrops investment?
We will answer this below, as well as clear up the confusion about where you live and where you retire as the two placed can be completely different.
First of all there is no officially titled RL360 qrops investment but what it often refers to is a QROPS that holds an investment wrapper by RL360.
So, when should a QROPS be considered:
- People who retire in certain jurisdictions where a UK pension would be taxed twice
- People approaching the age of 75
- People who retire in certain jurisdictions with limited double tax treaties, or where moving to a QROPS provides tax access advantages at point of retirement
- People who are around the pension lifetime allowance, normally people with funds in excess of £800,000 or more
- Emotive reasons, as people really want their money out of the UK for personal reasons.
If you do not fit one of these criteria then you probably should not be considering a QROPS, although there will always be exceptions.
So, the question often asked is “Where I live, should I be considering a QROPS?”
And our answer is, where you currently live is irrelevant, it is where you are going to retire and access your funds once you go past the age of 55.
Our earlier example, someone aged under 54 with a fund of less than £500,000 who lives in a jurisdiction in where a UK pension would be taxed twice. They intend to retire at age 60 and move back to UK or possibly somewhere in the EU. Can you work out the answer now?
No, they should not be considering a QROPS unless point 5 applies above. In fact, in this case they should be first of all leaving their money in a UK pension, possibly a SIPP.
However, if one of the 5 criteria above applies and the person wishes to retire outside the UK, then almost certainly RL360 qrops investment might be appropriate. The RL360 qrops investment can be good as long as no commission is being taken on the product. It confers certain benefits and RL360 as a company are good with good servicing.
More advice or information?
You can obtain more advice on Lifetime Allowance at our specialist Lifetime Allowance 2015website.
Please note that we do emphasise the RL360 QROPS investment bond is considered under the basis of zero commission. There are unscrupulous advisers according to newspapers such as the Telegraph that rip off clients due to hidden commissions that were not declared to the client, who in the words of the Telegraph cost british expats billions in hidden charges and suspect funds. Avoid these advisers at all costs.
The views expressed in this article are not to be construed as personal advice. You should contact a qualified and ideally regulated adviser in order to obtain personal advice with regard to your own personal circumstances. If you do not then you are acting under your own authority and deemed “execution only”. The author does not except any liability for people acting without personalised advice, who base a decision on views expressed in this generic article.
This article was published in January 2016