Qualifying Recognised Overseas Pension Schemes (QROPS)

The Equus Retirement Annuity Trust Scheme is a Gibraltar based QROPS provided by Castle Trust & Management Services Limited, part of the Castle Trust Group, a Gibraltar based fully EU compliant Financial Services Group.

It is an overseas pension scheme registered in the UK with HM Revenue and Customs (HMRC) with registered number QROPS 502472. It is recognised by HMRC as eligible to receive transfers from UK pension schemes and therefore is of significant benefit to individuals with UK based pension schemes who have, or intend to leave the UK.

The Equus Retirement Annuity Trust Scheme is a Gibraltar retirement annuity trust scheme and is open to both residents and non-residents of Gibraltar. It is operated in accordance with the Laws of Gibraltar.

Immediate Benefits

There are immediate benefits on transfer within the first 5 years of non-residence, for example:

If income is taken, and taxed as such in Spain and Portugal, the reduced level of taxation is effective immediately
Avoidance of the potential liability to death duties in Spain and Portugal if the QROPS pays the benefits to a Family Benefit Trust

The key attractions have proved to be:

The removal of the necessity to make a future Annuity purchase
The ability to pass on any remaining funds tax free to named beneficiaries following death after income has commenced
The significantly higher net income payments available for many clients using a QROPS

Independent Remuneration Planning specialists estimate the average pension rights that are transferred to QROPS are worth in excess of £250,000. There is no maximum amount. The minimum viable level is around £75,000, but lower amounts may be considered, subject to minimum transfer costs.

Eligibility

Individuals with UK pension funds who have become non-resident, or intend to become non-resident in the near future.
Individuals with a UK accrued pension scheme of at least £75,000
It is not necessary to be resident in the country where the QROPS is established to benefit, ie in this case Gibraltar. Individuals may be working outside the UK, eg Middle East or elsewhere in the EU

Further pension considerations as to applicability

Loss of protected rights

Transfer into any QROPS may lead to loss of protected rights which may be contracted out rights or rights accrued under a defined benefit scheme.

Lifetime allowance charge

If you have total funds in excess of the current Lifetime Allowance of £1.75m, the excess funds transferred will be subject to a 25% tax charge.

Return to the UK

On your return to the UK, UK pension legislation may apply to your pension assets within the Scheme. Specialist advice is necessary as we are aware it is possible in most circumstances to structure affairs prior to returning to the UK that provide a better solution. We do not give advice in this area but can provide you with details of specialists with whom we have worked in this area to achieve the optimum solution.

Benefits and key attractions

Flexibility
No requirement to secure an income by way of an Annuity at 75 years of age
May be possible for capital to be withdrawn from the pension fund if required
The Pension does not suffer UK tax at source, up to rates of 40%
The Pension is subject to the tax regime of the country where the individual is resident
In some cases pension benefits can be paid to other jurisdictions where there may be no deduction of tax at all.
Residential property and works of art may be placed within the Fund
Lump sum up to 25% may be taken after 50 years of age
Following death of the Scheme member, the remaining fund held within the Scheme may be released to the Member’s named beneficiaries – without a confiscatory level of tax
The QROPS is a personal scheme, not part of an Occupational Scheme