In order to live out a happy retirement you must plan ahead to ensure that you have the necessary funds to pay for it.


Here at Whitmore we understand that, aside from your health and the well-being of your loved ones, having enough funds for your retirement is of the utmost importance. Although we always urge our valued clients to safeguard their financial future by making sound investments, we also understand and indeed encourage you to set up a safe pension scheme in order to guarantee a regular income stream when you are no longer working. While this is fairly simple when you are living in your home country and have been part of a corporate pension scheme through your employer, it gets slightly more complicated when you move abroad, as the number of options available to you increase.


QROPS – Qualifying Recognised Overseas Pension Schemes were introduced by HMRC in the UK in 2006 in order to give additional freedom to expats still holding pension funds in the UK. QROPS allow nationals moving abroad to transfer the money from their pension savings funds without incurring any unauthorised charges or transaction fees. The QROPS does not have to be established in the new country of residence, which offers greater flexibility and a wider range of service provider, and they provide you with an opportunity to receive certain benefits from your pension, most significantly helping you to avoid tax in the UK.


You can receive payment of the pension in any currency and a QROPS is managed by trustees who make investments on your behalf, and which allows you to invest your funds in whatever assets you choose. Not all QROPS are the same and they all have different charges depending on how much can be taken as income, how that income will be taxed and whether or not you can access a tax-free lump sum. QROPS are subject to annual charges which are normally taken from the pension itself.


It should be noted that the UK government introduced a new overseas transfer charge which affects many QROPS which have been requested after the 9th March 2017. Please ask one of our consultants for a more detailed explanation.


In order to be eligible for QROPS:

  • You must be a UK resident or have spent time working in the UK
  • You must have a UK pension scheme
  • You must have a UK pension fund of at least £50,000
  • You are living abroad and will not be returning to the UK within the next 5 years
  • You have not bought any annuities
  • Your pension scheme should be in drawdown (if it’s a final salary scheme)

The benefits of QROPS are:

  • You can avoid significant tax in the UK
  • You can have your pension payments in any currency of your choice
  • You have protection from UK Inheritance Tax
  • Any residual pension funds can be transferred on to your beneficiaries easier than with UK pensions
  • There’s no maximum allowance which means you do not have to pay the 25%
  • Lifetime Allowance Excess tax charge on any monies above the value of £1.5 million
  • You can access your funds at 55 years old
  • You can receive an increased lump sum of 30% (rather than 25%) if you have been living abroad for  5 years or more

In order to set up a QROPS with Whitmore:

  • You first need to write a letter of authority so that your Whitmore advisor can review your existing pension schemes
  • You will also need to provide your QROPS pension transfer documents
  • Your Whitmore advisor will then produce a personalised report based on their review of the pension
  • Your Whitmore advisor will then explain each of  the options available to you and help you to decide which one suits you most

QNUPS – Qualified Non-UK Pension Schemes were introduced by HMRC in the UK in 2010 in order to allow expat scheme holders to avoid UK Inheritance Tax. They are regulated tax-efficient pension schemes which allow the holder to invest their wealth overseas, and they offer some flexibility and certain tax advantages, allowing you to shield your assets by placing them in an offshore pension scheme.


Anyone moving abroad is eligible for a QNUPS unless your new country of residence specifically prohibits this, while QNUPS are available in many different countries and are not restricted to states which have Double-Taxation Agreements (DTA) with the UK. It should also be noted that there is no maximum age limit for a QNUPS, and contributions can be made from income earned from sources other than from employment.


The benefits of QNUPS are:

  • There is no minimum value in taking a QNUPS
  • There is no maximum limit in how much can be transferred
  • There is no maximum age limit to contributing to a scheme
  • You can avoid paying Inheritance Tax
  • You may be able to avoid local wealth taxes
  • You are subject to tax-free asset growth
  • Growth is not liable to Capital Gains Tax which means that your beneficiaries will reap any capital growth of your assets
  • Reasonable start-up costs and management fees
  • Since QNUPS do not have to be located in countries with DTAs, a scheme does not have to be reported to HMRC



Defined Benefit Schemes (or Final Salary Pension Schemes) are pension schemes which your employer pays into throughout your employment career and whose monies are invested into various assets and funds. The amount of income you receive is not based on how much you pay in but rather it is decided when you initially agree to your pension scheme. Therefore the amount you receive is guaranteed and furthermore you will not have to decide how to access your funds at any time, except to decide whether or not to take a pension commencement lump sum, which the government allows up to 25% tax-free.


There are two different types of Defined Benefit Schemes, one which pays out an income based solely on the salary you were earning when you retired from your company, and one which pays out an income based on your average salary throughout your career. A Defined Benefit Scheme also means that the scheme takes on all the risk of the investments they make since they guarantee to pay out a certain amount.


It should be noted that, due to the fact that people now live longer than before, in some cases some schemes have insufficient funds to cover the payments. This is also due to the fact that Defined Benefit Schemes are closely linked to Gilts, Bonds issued by the UK government, and Gilt yields are at all-time low, which means that there is an ever-growing pension deficit. There are additional risks for expats with regards to Defined Benefit Schemes and it is often prudent to take out the pension pot and transfer it into a different scheme, such as SIPPS or QROPS.



Self Invested Personal Pensions allow you to invest into a pension for retirement and give you the right to make your own decisions on the investment options within your scheme, and thus allow you greater choice of investment options, especially when you have your own financial advisor. Basically, you are free to decide which funds to invest your pension monies into.


The money you pay into a SIPP is paid before income tax is taken off, which is a considerable advantage over other schemes. You can access your funds once you reach 55 years old and you have a choice to take out a lump sum payment whereby the first 25% is tax free, although any monies drawn from the fund are considered income and taxed as such, and are subject to the tax regulations in your country of residence. There is a maximum amount of £1 million you can save with a SIPP, and you can pay into it from any number of different sources. Since a SIPP does not have a fund manager, it is up to the individual to determine which funds to invest the money into, which means that it is imperative to consult with a financial advisor throughout the process.


It is slightly more complicated for expats since there is more due diligence which has to be carried out by the trustees of the pension scheme. More importantly, since SIPPs are held in the UK, payments have to be made in British Pound Sterling and you are thus liable to currency fluctuations, although if you’re paying into a scheme and the pound drops then the value of your investment actually increases. Also, it should be noted that, due to the fact that SIPPs are held in the UK, they are subject to any governmental changes to pension rules. It is important to understand that if you are an expat, you need to speak to an expat specialist financial advisor since many UK-based consultants are not aware of the full range of options available to expats.


For further information and independent advice, please contact one of our Whitmore advisors.