Gibraltar Acts To Preserve QROPS Status
by Amanda Banks, Lowtax.net, London
03 April, 2017
Gibraltar has made new pension regulations to maintain its attractiveness as a jurisdiction from which to transfer UK pensions.
The new regulations are applicable from March 31, 2017, ahead of UK pension changes taking effect from April 6, 2017. The regulations ensure that the UK tax authorities continue to recognize Gibraltar pension schemes as Qualifying Recognised Overseas Pension Schemes (QROPS). Transfers to QROPS are subject to a lower rate of UK tax on amounts transferred.
Albert Isola, Minister of Commerce, commented: "I am pleased to announce the introduction of these new pension regulations, which will ensure that Gibraltar retains the highest standards of pension regulation and maintains its status as a 'recognized' jurisdiction for QROPS pension schemes."
Isola added: "Following discussions with the UK authorities we have decided not to introduce flexible access for Gibraltar QROPS; rather Gibraltar will keep its current arrangements that require members of QROPS schemes to retain 70 percent of their total funds to provide a pension income for life. The rate of tax on pension benefits taken from these retained funds will continue to be levied at the current rate of 2.5 percent."
Isola also commented on the new transfer charge of 25 percent tax introduced by the UK Government on March 8, 2017, saying: "We expect there will be a change in appetite for people to move their pensions offshore because of the introduction of the new transfer charge. It has been confirmed that Gibraltar will be treated as an European Economic Area (EEA) country in respect of the new transfer charge, which is positive, and so Gibraltar will be able to continue to offer QROPS to individuals living in the EEA subject to the new requirements."
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