Wednesday, 29 December 2010

2010 in summary

At the end of the calendar year and the fiscal year in Spain, I thought I would reflect on the main issues and topics on ‘Financial Pages in Spain’ during 2010.

  • Pensions, including QROPS & QNUPS

  • Getting a second opinion

  • Tax saving

These are the issues that contributed the most feedback. I’m always pleased to receive emails either to seek further advice or to comment on my articles.

Using the statistics provided by my service contractor, I can also indicate the most popular posts in terms of the number of people who visited the pages. They were, in order;

  1. New Zealand QROPS and NZFT

  1. QNUPS – Qualifying Non-UK Pension Schemes

  1. Lost, Forgotten and Misplaced Accounts
  
If you need advice please email me for connection to an authorised and regulated adviser.

The blog is also being read far and wide. So far, according to my statistics, it has been read in 37 countries. Not surprisingly, the furthest away being New Zealand.

The top three in order;

  • Spain
  • United Kingdom
  • USA

It is great to be able to give you the feedback and readership popularity but I thought I’d also tell you what I enjoyed most of all.

Most of my writing comes from personal experience as an adviser, from my first hand knowledge in Spain and lots of reading to keep up to date with trends and changes. In December, I was able to write about a completely new concept based on a UK tax break. This appeared under the title ‘Furnished Holiday Let Tax Saving’


I’d like to say a personal ‘thank you’ to the readers who have made writing this Blog very rewarding and worthwhile

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I would also like your ideas. You could influence the content in 2011. If any reader thinks that there is a subject that I should cover, please drop me an email

Friday, 24 December 2010

Happy Christmas

Thank you for reading my Blog.

No QROPS, QNUPS, Pensions or regulations today - just a big thank you.

Very many people have told me good things about my work. I have been amazed at the readership since I started in August 2010. I have also started my own website which compliments the work. http://www.financial-pages-in-spain.co.uk/

See you next week in the run up to the New Year

Best wishes, David

Friday, 17 December 2010

Getting a 'second opinion'

I have been finding for sometime that many people come to me for a ‘second opinion’ For QROPS, QNUPS, UK Pensions, Investments, they are unhappy with the advice they have been given and send me examples.

  • ‘ It  looked like a mass produced QROPS report with just my name and personal details changed’

  • ‘ They wanted an up front fee even to talk to me, funny they never mention that in their adverts’

  • ‘ I wasn’t convinced the advice was correct’


Those sadly are just a few of the comments I have heard in the last few months. Even though ‘Financial Pages in Spain’ only started in August 2010, I am receiving comments which show a great deal of respect.

I’ll try to help. Email me

Can you help me to help you?

  • Please send me both good and bad examples of reports you have received, from financial advisers, I’ll respect your privacy
  • Tell me the names of Advisers who refuse to disclose commissions
  • If the fees, charges and commissions are hidden in a report and not openly disclosed, please send examples

This sort of information will help everyone and help eradicate some of the greedy practices.

I may not have intended it when I started out but it seems that Financial Pages in Spain is becoming the respected second opinion.


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Whatever your query, please write to me. My email is on this link

Thursday, 16 December 2010

QROPS - Changes afoot?

I’m not a betting man but I do like making forecasts. In the next two or three weeks at least one firm of International Financial Advisers will stop using Guernsey for QROPS. Why you may ask?

  • Guernsey is not so good? – sorry, that’s not the reason

  • They prefer New Zealand? – no its not that either

  • Some Guernsey regulations have changed? – Yes, that’s it
  
The changes offer greater protection to the client!

Let me explain. On the 1st January 2011 new regulations will come into force for all Guernsey QROPS providers. In summary the key points of these new provisions are;

  1. The Guernsey Trustees must keep a copy of the Advisers Justification (advice letter) on file and check that the advice is accurate.

I know at least one well known ‘adviser’ who won’t like that.

  1. The Guernsey Trustee must be satisfied with the investment plan in which the QROPS is invested

The same ‘adviser’ won’t like that either

  1. If the transfer is from a Defined Benefits Scheme (Final Salary Scheme), the trustee must ensure that the client is aware of the comparison in the benefits.

In my opinion this is an excellent requirement and similar to the UK requirement but I know many ‘advisers’ will not

  1. Fees / Commission Disclosure.

Advisers will have to disclose all commissions and fees payable by the client’s scheme. This includes fees to trustees and commission received for pension, financial and investment advice.

I have complained many times that the Financial Services Authority (FSA) doesn’t make this a requirement for its registered advisers passported into Spain. So many advisers are happy to use FSA in their marketing but it should be a compliance organisation. But now the Trustees will become more strict than the FSA!

The predictable ‘advisers’ will not want clients knowing their commissions and in many cases they don’t even accurately declare all the charges.


If you would like a copy of the new regulations, please email me for a copy.

In the next few weeks, you will hear all the excuses

‘After a strategic review………..’
‘Dissatisfied with the service…..’
‘Change in direction…………….’

But the real reason will be that the usual suspects don’t want to disclose commission, don’t want their advice letters checked and have their investment preferences open to criticism.

You need to get your advice from advisers who are open in their disclosure and will be happy to meet the new requirements! I can introduce you to such an adviser if you email me.

I think this is really good news, an exceptional move to let the client know exactly what is happening to their pension plan.

Friday, 10 December 2010

QNUPS - Great News Update!!

The Treasury in the UK has produced ' Draft Finance Bill 2011'

QNUPS will benefit in two DIRECT ways

  • QNUPS - Qualified Non-UK Pension Scheme ( remember it is a Pension) no longer has a requirement to buy an annuity
  • Now has a unique IHT (inheritance tax ) protection position


Further information, personal queries or links to fully authorised and regulated advisers, please email me


Thursday, 9 December 2010

QROPS – Questions and Answers

I have published a question and answer post before, but this is updated to include queries raised by readers. Many people have written to me for a ‘second opinion’

·        Is there a minimum amount for QROPS?
·        How much does QROPS cost?
·        ONLY get authorised and regulated advice

So let’s start with a definition. Qualifying Recognised Overseas Pension Schemes (QROPS) were introduced in April 2006, by the UK Government, as part of a process called Pensions Simplification.

The ‘Question and Answer’ format here which should cover the main issues for those of you who live in Spain or indeed those who intend to live in Spain.

What’s the minimum amount I can transfer into a QROPS?
Some advisers regard sums of under £100,000 as ‘small pots’ not worth transferring. However, with extremely low annuity rates and poor rates under the GAD rules, readers with less than £100,000 to be transferred need and deserve advice. New Zealand QROPS, which I have dealt with, before are certainly worth readers looking at. Let me recommend an adviser, click here. If your adviser says your fund is too small – seek a new adviser!

Is the transfer into a QROPS expensive?
The main cost associated with a QROPS is the preliminary registered scheme
transfer work that is required before your pension assets can pass into a QROPS. This is specialist work and I’ve never thought cheapest is best in professional advice. However, it must be reasonable. A really good financial adviser, who is properly authorised and regulated, will put the costs in writing, before expecting you to sign up to their scheme. I’m happy to recommend such an adviser if you contact me here. Please be aware that some advisers  don’t tell you the costs in an open and unambiguous way. Always seek clarification.

As part of my ‘second opinion’ option, if you have a report which is unclear, send it to me and I will give my thoughts.

I’m happy with the investment in my SIPP, why can’t I transfer it to QROPS?
If an adviser indicates that you cannot transfer your existing pension investment to QROPS they are wrong. This type of transfer is known as an ‘In-Specie transfer’. It is acceptable in QROPS because to meet the rules in the UK the investment has to be approved. If the investment is acceptable in the UK then it is perfectly satisfactory in QROPS.

Some advisers have difficulty in distinguishing between their own business model and the rules! To avoid such advisers, please email me

What can I invest my QROPS assets in?
There is a flexible choice open to you and part of a good adviser’s process is to determine and agree an investment strategy which closely matches your needs. Your attitude to investment risk is also key, since it will indicate the asset classes that you should use and those to avoid.

Will any benefits I take from QROPS be taxed?
QROPS income is generally not taxed at source. The tax treatment of what you receive is very favourably treated in Spain, though you need individual advice to explain how it affects you.

What will happen to my QROPS when I die?
Any funds remaining when you die will either be paid to those nominated by you as beneficiaries or those same beneficiaries may simply continue deriving the same tax free advantages you were enjoying in your lifetime.

Are there any circumstances in which I shouldn’t transfer to a QROPS?
If you want the certainty of income and are prepared to hand over your fund to a pension provider, then an annuity might suit you better than QROPS. I would not suggest you to transfer to QROPS if you intend to be expatriate for less than six years, but you need advice from an authorised and regulated adviser.

I’ve heard about unscrupulous QROPS providers and intermediaries, any
comment…?
In May 2008, Her Majesty’s Revenue and Customs (HMRC) withdrew status from all Singapore based QROPS. This action emphasises the importance of taking independent advice from industry experts who are in regular contact with HMRC to ensure that any transfers do not nor are likely to fall foul of HMRC regulations. The best advisers can also offer a choice of QROPS based in more than one jurisdiction. Ask to be introduced

Which is the best QROPS jurisdiction?
The only honest answer is that it depends on personal circumstances and can also be determined by an individuals own preferences. I can say that for Spanish residents the worst jurisdiction would be Spain!

If the pension value is quite modest and you have been UK non-resident for more than five full and complete tax years, then New Zealand is a credible jurisdiction. Under these circumstances you have the option to encash your pension plan.

You need to be aware of advisers who consistently make exactly the same recommendation to 95% to 98% of their clients. The clients circumstances are ALL individual and deserve tailor-made solutions. I am here to give a second opinion.

By being open and frank with an authorised and regulated adviser, a plan can emerge which has to be in the individuals best interests. If you email me, please give me a brief outline of your circumstances and what your immediate objectives might be. I will ensure that you get authorised and regulated advice. If you live in Spain and are considering a Pension Transfer (including QROPS), the adviser that I recommend will regulated by one or more of the following;

CNMV
Comision Nacional del Mercado del Valores is the principal financial services regulator in Spain and responsible for authorising investment products.

DGS
Direccion General de Seguros y Fondos de Pensions is the Spanish regulator for insurance products which can be marketed in Spain.

FSA
The Financial Services Authority – the UK’s financial services regulator.

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If you have a further question, I’d be delighted to answer it. Those of you who live in Spain or intend to live in Spain should be very careful when choosing an adviser. You can write to me with your personal experiences or to be put in touch with a recommended adviser Email me here

From my own experience, I only ever recommend advisers that I know and even then I am happy to help my readers by ‘looking over their shoulder’. Whatever you decide to do please tread carefully.







Friday, 3 December 2010

Furnished Holiday Let Tax Saving

Good news for some property owners – and I haven’t said that for sometime!

Regular readers of ‘Financial Pages in Spain’ will know that most of my articles are aimed at British and Irish expats in Spain. This article is for the benefit of UK Taxpayers with furnished holiday let property anywhere in the EU including Spain.

In summary, to benefit you need to answer ‘yes’ to the following four criteria;

  • Is the owner a UK taxpayer?
  • Was the purchase price in excess of £150,000?
  • Is the property a furnished holiday let in the UK or any part of the EU?
  • Is the property let out for more than 70 days a year and available for letting more than 140 days per annum?

Anyone who can answer ‘yes’ to all of these questions may be able to save thousands of pounds in future tax. Start the ‘ball rolling’ by sending me brief details by email

Now that the 2010 Budget and Autumn Statement have been announced and debated, the availability is in no doubt until 5th April 2011. Since the Government is constantly looking for extra revenues I cannot be sure that it will be available in the 2011/12 Tax Year.

The Tax Office (HMRC) of course does not advertise that the entitlement is available but every person who qualifies will almost certainly have overpaid tax. It has been estimated that under 2% of UK taxpayers who own furnished holiday let property have made a claim. So, Holiday let owners, 98% of you have a claim to make! But it has to be a very detailed, pre-determined report in the form of a survey.

This benefit is given as either a tax rebate or often a reduction in future tax payable.

Whilst accountants will do everything possible to claim benefits for their clients, this is a specialist field. The promoters, who provide access to this entitlement, must conduct a very rigorous survey of the property, to standards set by HMRC and presented in a specified format. As the work involved is so detailed and time consuming, you must not just answer the questions above as ‘yes’, there is another filter where the company will discuss by phone or in person, the finest detail to ensure compliance.

Because of this diligence and expertise the company has a 100% success record on cases submitted to HMRC. If you feel you meet the criteria, please email details to me, which will be in total confidence.

The following step by step guide shows how the scheme works and where you fit into it.

There are five steps;

  1. There is a telephone or face to face meeting with the scheme provider to establish that a claim would be valid. So much detail at this step can save lots of time in the process.
  2. The property is surveyed, in great detail, taking lots of photographs (the record number is 400) as these form part of the HMRC method and standards required.
  3. The claim will include hundreds of items within the ‘intrinsic fabric’ of the property, for everything, including the kitchen sink!
  4. The norm is to find capital allowances equivalent to 25% of the property value which can then form part of the claim
  5. When the allowances are calculated and identified in the HMRC format, a Report is completed within a two week time-frame. This is sent to the UK taxpaying property owner for approval before the claim is made to HMRC.


My apologies, there is one step I have forgotten. Before step 1. above please send me details of your circumstances and potential claim.  This means that I can put you in touch with the company promoting the scheme, without delay. Send your details to me by email as soon as possible.

Please don’t wait until next year.

Thursday, 2 December 2010

November summary

At the end of the calendar month, I thought I would reflect on the main issues and topics on ‘Financial Pages in Spain’ during October

  • Pensions, including QROPS

  • Mortgages

  • Tax issues

These are the issues that contributed the most feedback. I’m always pleased to receive emails either to seek further advice or to comment on my articles.

Using the statistics provided by my service contractor, I can also indicate the most popular posts in terms of the number of people who visited the pages. They were, in order;

  1. Special Pensions Week

  1. Pensions – explaining terms, expressions and jargon

  1. Mortgages – explaining terms, expressions and jargon

I was particularly pleased with the article which was viewed by the most readers during Special Pensions Week. QROPS receives a huge amount of coverage in the press but here the most popular article was ‘QNUPS – Qualifying Non-UK Pension Schemeshttp://expatsfrombritain.blogspot.com/2010/11/qnups-qualifying-non-uk-pension-schemes.html

If you need advice please email me for connection to an authorised and regulated adviser.

The blog is also being read far and wide. So far, according to my statistics, it has been read in 34 countries. Not surprisingly, the furthest away being New Zealand.

The top three in order;

  • Spain
  • United Kingdom
  • USA

I’ve also picked up a regular reader in Malta who is very welcome.

It is great to be able to give you the feedback and readership popularity but I thought I’d also tell you what I enjoyed most of all.

Most of my writing comes from personal experience as an adviser, from my first hand knowledge in Spain and lots of reading to keep up to date with trends and changes. This month I was able to write about a completely new product – Pension Reciprocation Plan (PRP). This appeared on my Website

The PRP appears on;


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I would also like your ideas. If any reader thinks that there is a subject that I should cover, please drop me an email

Wednesday, 1 December 2010

Residency – Making it clear

October 2011 - Update
The UK is planning new rules for UK residency with effect from April 2012. These will impact on British citizens who move and establish residency in Spain. When my research is complete I will give readers a full update.


Meanwhile, Spanish residency rules continue to apply with no change.


December 2010


In an unambiguous world where facts are facts and myths are myths, I would not need to write this article. However, this is Spain and British expats seem to be misled time and again. Please remember that I can also answer more personal questions if you email me in confidence.

  • Its not just about a form from the Comisaria or Police

  • Its not about Double Taxation Agreements

  • It is about where you pay your taxes


Two factors about where you live are important from the outset. I am only dealing with the rules for EU-citizens. Non EU-citizens have a more detailed procedure to go through.

NIE - Numero de Identificacion de Extranjeros

An NIE number is essentially a tax number for foreigners in Spain. You need one if you are going to buy a house or a car, if you are going to work for a Spanish company or if you want to apply for residencia (a residency card). If you are an EU citizen, you no longer have to apply for your NIE number, separately but you will be given one when you register as a foreign resident as detailed below.


Residencia

The rules on residencia cards in Spain have been changed several times in the last ten years mainly to give clearer cut rights to EU citizens living in another member state.
Briefly, if you are an EU citizen, you must now register at your local Oficina de Extranjeros which is usually in the local Comisaria or Spanish national police. You will need to complete a form and pay a fee, and you will be rewarded with a certificate which shows your name, address and NIE number.


Residency – paying taxes


However, just as important is the question of where you pay your taxes.
One of the myths which needs exploding is that the Double Taxation Treaty (DTA) between the UK and Spain or indeed any EU member and Spain is that citizens can choose where they pay there tax. That is wrong. The principle benefit of a DTA is so that you cannot be expected to pay tax twice on the same income or capital gain. It is NOT about choice.  
I have said this before on my Blog but it is worth repeating;
British expats in Spain fall into two clear and unambiguous groups;

  • Spanish Residents who are best described as people who have settled in Spain and spend 183 days or more per year in Spain. This group of people are required to pay their taxes in Spain.

  • UK Residents who spend less than 183 days per year in Spain. This group of people are liable, for their taxes, to HMRC in the UK.
  
Summary

There are lots of myths but you need to be sure that you are on the right side of the law. If you have chosen to live in Spain, I think you have chosen to pay taxes in Spain or at least to make a declaration. The DTA protects you from the UK also wanting a slice! Email me if you have specific questions, please