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QROPS in Australia2020-12-27T13:23:58+08:00

QROPS Overview

If you are age 55 or over, you can transfer your UK Pension to a Qualifying Recognised Overseas Pension Scheme (QROPS).  There are significant benefits associated with this:

  • Transfer up to A$100,000 per year tax free
  • Bring forward 3 years and transfer A$300,000 tax free
  • Pay no tax on the capital amount and only 15% maximum on any earnings
  • Capitalize on historically high cash transfer values from Defined Benefit Schemes (final salary pensions)
  • Eliminate exchange rate risk with GBP/AUD
  • Control and flexibility with investing and accessing your money how you want

Contact us (using the form below) for a free assessment of your UK Pension status and how to access more of your UK Pension in Australia, tax efficiently.

Already have an Overseas QROPS?

If you are like many other British expats and have an existing QROPS in another country (eg Malta, Guernsey, Isle of Man, New Zealand), you can still take advantage of transferring this pension again to Australia tax efficiently, or even tax free in some cases.

QROPS in detail

Once over age 55, you can transfer your UK pension to an Australian Superannuation Fund as long as the Superannuation Fund is registered with the HMRC as a Recognised Overseas Pension Scheme (ROPS).

There are several benefits of rolling over to an Australian fund:

  • The capital amount you transfer is tax free  – both in the UK and Australia
  • The growth (applicable fund earnings) that the pension assets have experienced since the member became an Australian resident is taxed at 15 per cent rather than the individual’s marginal tax rate, which could be up to 47 per cent.
  • The growth component doesn’t count towards the concessional or non-concessional contribution limit.
  • By rolling over to a ROPS, no UK tax is withheld provided the individual is within their lifetime allowance.

You can only transfer your UK pension to an Australian ROPS if you are aged between 55 and 75.  If you’re aged between 65 and 74, then you can only transfer to an Australian Superannuation ROPS if you meet the ATO “work test”.

When transferring to a ROPS, you must ensure that you do not go above the Australian superannuation contribution cap limits otherwise you could incur penalty tax.  The non-concessional contribution caps are $100,000 per year.  However, if individuals are under the age of 65, 3 years worth of non-concessional contributions can be made in one year but then you will not be able to make any further contributions in years 2 or 3.

If a QROPS scheme and member are not resident in the same country then a 25% UK tax will apply on transfer and will be deducted by the remitting scheme.  In addition, transfers to a non-ROPS compliant scheme will result in a 40% to 55% tax charge on the transfer from your UK fund.

In most circumstance, it is not cost effective to transfer unless the value of your UK pension is over £50,000.  State pensions  and certain unfunded public sector pensions (eg NHS, Teachers Pension) cannot be transferred.

Please note that the above is general guidance and it is important that you speak to a qualified financial adviser to consider all your options.

Free Consultation

If you are considering transferring your UK pension to Australia, or already have a QROPS and want to know more about your options, contact us for a free pension consultation with a registered adviser. During the consultation, we can provide you with advice that will:

  • Highlight all the options available to you
  • Guide you through the benefits and costs of a ROPS
  • Identify whether a ROPS may be suitable for you
  • Provide you with a second opinion about any advice you have received previously

This is a free service and at no time are you under any obligation to proceed with any advice.

Free Consultation

If you are considering transferring your UK pension to Australia, or already have a QROPS and want to know more about your options, contact us for a free pension consultation with a registered adviser. During the consultation, we can provide you with advice that will:

  • Highlight all the options available to you
  • Guide you through the benefits and costs of a ROPS
  • Identify whether a ROPS may be suitable for you
  • Provide you with a second opinion about any advice you have received previously

This is a free service and at no time are you under any obligation to proceed with any advice.