overseas pension to the UK

Can I Transfer an Overseas Pension to the UK?

07/02/2023tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

There is a rapid inclination among people who are working abroad, however, they want to end up their retirement in the UK to settle. Now, the wish to pursue the dream of retirement makes people question whether it is possible to transfer an overseas pension to the UK. This is normal to wonder over such confusion in every individual case. There are multiple guides available on such scenarios on the website of the government as well. However, the facts are hidden behind the jargon of confusion. It is a true scenario to form solutions about. Realising the need of the moment, we have tried to provide a breakdown depending on the frequently asked question in this regard.

This comprehensive guide will hold a discussion about what is referred to as the overseas pension, how can I transfer an overseas pension to the UK, what is QROPS and how is it related in this regard. You must also be wondering about is the procedure of transferring your overseas pension to the UK risky or safe. Well, you are on the right one that will allow gathering information about everything that you want to know about your overseas pension and transferring it to the UK if you want to finally settle here. Let us get further indulged into the discussion to know better.


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What Refers to as the Overseas Pension?

Normally pension and the relevant amount refers to the saving scheme which is a support to make you prepare for retirement in the UK. As you might already know that the amount of pension is already being deducted from the salary you are getting every month. In some cases, there is a contribution of the employer as well and this totally depends on the generosity of your company and its consequences that will decide how much will they contribute. We will take the instance of an individual who has spent the duration of 35 years in the workforce and has paid the national insurance as well, the individual will be able to get the full amount as a pension. Now we can call the overseas pension when you plan to move this amount to abroad.


How to Transfer an Overseas Pension to the UK?

It becomes a little tricky and complicated when you plan to transfer your overseas pension to the UK. This is normally because of the strict rules in the UK that make the process a little complicated. However, if you gather information about how to go about the procedure, it might not sound as difficult as in the beginning. All you have to do is get in touch with the pension providers in the UK. This might not always be a successful plan because there are many pension providers in the UK who will not accept the case of transferring the pension. You must take the account of letting your original pension provider know that you plan to transfer your pension to the UK.

This will help if you check on the pension providers in the UK as well as the overseas pension provider. This will make the experience a little less complicated for you if you find the right kind of pension provider who will accept the pension payment. QROPS is your rescue on such a stage. This is imperative to know here, what is QROPS.


What is QROPS and How is it Related?

QROPS refers to the kind of pension overseas that aligns with the set of rules regarding pensions in the UK as per the instructions of HMRC. The pension providers in the UK will also accept the pension payments if the criteria of HMRC are met. QROPS is known for being credible as well. You need to be aware of the pension scammers here especially when you are a beginner to this procedure. If you have an awareness of the qualified pension scheme, you will be able to identify the scammers and be away from them as well. If your original pension provider is approved according to the recognition criteria of HMRC in the UK, the source of money will still be required to be checked by the professionals. As this is always better to be safe than to regret it later.


Is Pension Transferring to the UK a Risky Procedure?

To keep the factor of risk low in the case of transferring the pension amount to the UK, you will have to double-check every step in the procedure. There are some real factors that can be called risk factors, you will have to be conscious of them during the process of transferring your pension amount. These are listed:

  1. The value of money will be lost because of the fluctuation factor when it is transferred to the UK.
  2. The fixed protection of the pension amount will also is at risk.
  3. You will no longer be allowed to take the tax-free lump sum from your pension pot.
  4. After a certain age, the rights to pension are also limited.
  5. You will have to deal with the pension transferring fee which has a high percentage depending on your case.


The Bottom Line

Now that you have gathered a fair amount of information about how to transfer an overseas pension to the UK, we can bring the discussion towards wrapping up. It is fairly possible to transfer your overseas pension to the UK, however, there is a certain set of rules that is to be followed to avoid any unfavourable circumstances in the future.


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Disclaimer: The general information provided in this blog about how to transfer an overseas pension to the UK includes text and graphics. It does not intend to disregard any of the professional advice.

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