With 120,000 Irish Residents holding British pensions, Brexit negotiations have got people thinking about transferring pensions from the UK to Ireland.
A QROPS (Qualifying Recognised Overseas Pension Scheme) is a type of overseas pension product which has been registered with Her Majesty’s Revenue and Customs (HMRC) in the UK and can accept pension transfers from the UK without the potential for triggering a tax charge.
Transfers to non QROPS schemes can result in tax charges of up to 70%
QROPS are relevant for people who have worked in the UK at some stage of their career and have built up a UK pension. If you’re now living in Ireland with no intention of leaving, then you may want to consider bringing that pension back to Ireland.
What types of pensions can be transferred
You can transfer most private sector pension but most public sector pensions cannot be transferred as they are unfunded schemes (in the same way as our own civil service pension scheme, here in Ireland).
Benefits of transferring a pension from the UK to Ireland
- First, convenience. It makes things simpler if you’re planning to retire here in Ireland.
- Second, it gives you greater control over your investment
- Thirdly, UK pension income (after a tax free lump sum) is taxable as income in Ireland so the individual will need to do a yearly tax return in respect of this income
- And lastly, inheritance planning. If the beneficiaries of your will or your dependants aren’t living in the UK, leaving your pension there may be more complicated to deal with, so it may make more sense to transfer your pension to Ireland.
Irish Revenue will permit transfers in to an Irish arrangement provided:
- The Individual is a tax resident in Ireland
- The transferring scheme facilitates the transfer
- The relevant Revenue Authority in the transferring state approves the transfers
If you have a UK pension and you wish to discuss your options, please contact Gallivan Financial today. We’ll be happy to help.
All the best,
The Team at Gallivan Financial