Saturday, 21 March 2015

UK Pension Schemes or Plans but you have emigrated?

Ask for a review, without obligation, with a UK AUTHORISED adviser with experience of helping expats. UK Budget changes to Pensions make this VITAL

Types of schemes, options and regulated advice

It seems that every year, in the UK, there are new laws, new regulations, new ideas or changes to pension plans or schemes. Just to complicate matters there are still many arrangements which have different names! The changes announced in March 2015 are fundamental

UK Pension Plans and Schemes

Here are a list (and it probably isn’t exhaustive) of the titles sometimes used for pension plans. If you have one but don’t understand what it is, please email me.

PPP – Personal Pension Plan
SIPP – Self Invested Personal Pension
GPP – Group Personal Pension Plan
S32 – Section 32 Pension Transfer Plan
ShP - Stakeholder Pensions
PPTP – Personal Pension Transfer Plan
UP – Unsecured Pension
ID – Income Drawdown
ASP – Alternatively secured pension     
AVC – Additional Voluntary Contributions
FSAVC – Free Standing Additional Voluntary Contributions
COMPS – Contracted Out Money Purchase Scheme
CIMPS – Contracted In Money Purchase Scheme
EPP – Executive Pension Plan
RAC – Retirement Annuity Contract
Section 226 Annuities
Superannuation Schemes
SSAS – Small Self Administered Scheme
OPS – Occupational Pension Scheme
DBS – Defined Benefits Scheme
FSP – Final Salary Scheme (DBS & FSP are the same – different names)
S2P – State Second Pension
GPS – Graduated Pension Scheme
SERPS – State Earnings Related Pension Scheme
BSP - Basic State Pension
SRP – State Retirement Pension (BSP & SRP are the same)

Maybe, you’ve even got something with a name not covered here! Please email me if you want anything explained!

Even when you have understood the plan or scheme you have, there could be a whole variety of rules and regulations that you don’t understand.

What are Your Options?

This is not meant to be exhaustive and is generic, you really need to consult a reputable authorised pension adviser.

·        Do nothing
This is very much the worst option. If your circumstances are changed, including emigrating, you need to know the affect on your pension arrangements

  • Take the benefits exactly as they were intended but transfer the pension income to Spain
This is often a good option but still needs to be reviewed. Circumstances change and you might have benefits you no longer need or you want to change the date of retirement. Many schemes have restrictive clauses which can affect your options and rights. You also need the correct tax treatment of your income.

  • Bring your pensions together in a QROPS
For most people who emigrate, this is the best option, though it also needs caution and advice from a specialist. I recommend the ‘further reading’ below. In particular, beware of adverts which promise cash settlements and benefits before normal retirement date. If it sounds too good to be true, well you know the rest. Please email me for details of a genuine specialist.

  • Bring your pensions together in a SIPP
You can certainly use this as an option. If your emigration is not permanent it could be a good one. However, the self investment aspect of a SIPP is often available within a QROPS. Not all SIPP trustees will allow investors who live outside the UK, so you certainly need specialist advice.

  • Best decision : Review your pension options with an authorised UK pension transfer adviser

August 2014
Warning from HM Government about UK Pensions
From Steve Webb, Pensions Minister
“If cold callers offer you massive returns for your pension pot that are just too good to be true, it is because they are.”
Sunday Times August 10th 2014

For most people, their Pension Fund is the biggest or second biggest asset. BEWARE Scam Watch as this post warns

David Goodall
Financial Pages in Spain

Further Reading:

QROPS Qualifying Recognised Overseas Pension Schemes

Do you transfer money, bank to bank on a regular basis? You can reduce the ‘currency risk’ with La Torre Fx – Foreign Exchange This service is also better than most banks for one off transfers