Satelitte Dish & Stand

Expatica - Health
Post reply   Start new thread
New - Old :: Old - New

Pages: 1 |

El Trampolin forum threads
The Comments
07 Mar 2008 12:00 AM by Cormona Star rating. 69 forum posts Send private message

Cormona´s avatar
Getting the most from your pension in Spain

March 2008

Many Britons wait until they retire before moving to Spain so that they do not have to worry about earning a living, relying instead on their pension to provide a regular income. If you have contributed to a pension scheme during your working life you will want to get the most from it that can be taken.

Until recently, UK pensions have had to remain under UK rules, even if you retired to Spain. However, thanks to new legislation in the UK, it is now possible for British expatriates to export their pension fund out of the UK, thereby avoiding the various restrictions that the UK imposes on how you take your pension benefits.  There is also the possibility that you will pay less tax in Spain.   

UK pension schemes can be very inflexible.  There are restrictions on how and when you draw down your benefits and in most cases you are forced to buy an annuity at age 75.  At that point you then cannot leave any balance of your pension fund to your heirs on death.

Overall, therefore, transferring your pension out of the UK and avoiding such restrictions could help you improve your retirement years in Spain.  It could also mean that you leave your heirs a larger inheritance.

The new legislation has created international pension products called QROPS – Qualifying Recognised Overseas Pensions Schemes.  They are non-UK pensions which meet the rules of, and are authorised as pensions in, the jurisdiction where they are located.

HM Revenue & Customs (HMRC) now allows UK pension rights to be transferred out of the UK into a QROPS.   In order to obtain QROPS status, the provider must meet a number of HMRC rules relating to how and when benefits can be taken. It must also comply with reporting requirements for five complete tax years after the fund holder has left the UK. 

While some QROPS have rules whereby you must be resident in the country where the scheme is located, others do not.  In this case you can choose a tax friendly jurisdiction which has more flexible rules on how the benefits can be taken. Not all overseas pension schemes qualify as QROPS so you need to ensure that you only transfer into an authorised scheme.

In order to transfer your pension out of the UK you must have already left the UK for tax purposes or be intending to move out of the UK shortly.  Once you are tax resident in Spain, you can transfer your pension fund out of the UK into a QROPS.

Which UK pensions can be transferred to Spain?

Many types of pension can be transferred, including personal and occupational pension schemes.  Pensions that are in drawdown (even if currently in payment) and protected pension rights can also be transferred.

Unfortunately, it is not possible to transfer a basic state pension, or if you have already purchased an annuity.  This also applies to most Final Salary Schemes if you have already begun taking benefits.

Hope it helps save somebody money.....



_______________________
Four leaf Clover..


Like 0

Spam post or Abuse? Please let us know

Pages: 1 |
Post reply   Start new thread


Previous Threads

Transport available from Torrevieja area to UK. - 6 posts
Satellite Dish & Box for Sale - 2 posts
Building insurance phase 3B - 0 posts
Sky TV - new cards coming soon - implications? - 0 posts
I saved water & electric by changing my shower head! - 7 posts
THE EASIEST WAY TO SPEAK AND LEARN SPANISH - 0 posts
what's the weather like in the alicante area at the moment - 8 posts
Touring caravan wanted - 1 posts
Where does all the Garden Rubbish go? - 8 posts
Electricity and Water - 1 posts
Has anybody ever heard of this card - 2 posts
Smoking in Spanish restaurants - 1 posts
Whats your perfect golfing holiday? - 3 posts
Overview of the health system in Spain - 1 posts
Limited 3% - 5 posts
Guests to avoid... - 1 posts
investment required - 2 posts
Legalities - Here you can post all your questions - 0 posts
Good restaurant in Villajoyosa - 0 posts
Hydropool Hot Tub - 7 posts
Professional Family Need home ! - 1 posts
Ryanair axes one in seven budget flights from Stansted due to soaring fuel costs and airport fees - 0 posts
Should we buy at Royal Dream?? - 4 posts
long rent in Ayamonte - 1 posts
Long term Rental - Alpujarras - 36 posts

1 posts were found:


1 |
Our Weekly Email Digest
Name:
Email:


This site uses cookies. By continuing to browse you are agreeing to our use of cookies. More information here. x