Taxation Treaty Uk & Thailand

[melbat]

I recently had a letter from the Inland Revenue in the UK. They ask me as I have been living in Thailand for some years do I wish to be taxed in Thailand or in the UK as the UK has a double taxation treaty with Thailand. Now this has not been a problem for me in the past as my income from my Uk private pension was not subject to taxation as my allowances in Uk covered the amount I was getting from the pension. After Feb next year I will be getting my state pension + my private pension which will take me into a higher tax bracket. My question is as I hope to be living here for some considerable time in the future what is my best option? It says on the form I had from the UK, I have to get a 'Certification Of The Form By The Tax Authorities Of My Country Of Residence' I live in Phuket so where do I go for that? If anyone has some good advice for me on how to go about things I would really appreciate your replys.

[aree2]

Hi Melbat

Would you mind saying how long you've lived here? I'm now in my 7th tax year away: would that be long enough for one to expect to receive the same offer from the Revenue? If so, I'll look into the matter too

[BIGTOE3]

As I hope to be a tax Excile from 2011 I am also very interested in this thread.

I thought ( maybe incorrectly ) that you just had to be out of the UK for a full fiscal year.

What are the tax rates in Thailand under this tax agreement - anybody know.

Thanks

BT

[JimsKnight]

AFAIK it's around or about the 280 days of a calander year for tax-exile.

Don't quote me on that cause I'm just going off old info from a year or so ago.

[chiang mai]

I don't even begin to understand the OP's post and wonder if there's not some element of scam involved in the communication he's received, here's why I think that:

UK income for UK citizens is taxed in the UK, pretty much end of story. Tax residents and non-residents are treated the same way, both have a tax free allowance but both are then taxed on income arising in the UK, including pensions - there are however double taxation agreements between the UK and a series of countries, including Thailand, and these are in place to ensure that taxpayers do not pay tax twice, it's a form of balancing mechanism if you like. But for the UK government to suggest that they would relinquish tax revenue and suggest that it might be paid in another country, makes zero sense to me. Perhaps someone else with more detailed knowledge and/or a different perspective can comment?

[fletchsmile]

As Chinagmai says - OP's post is a bit odd. The following link would be useful to answer a lot of the basic questions already raised and some that will come up - so worth a read. Starts on National Insurance, and moves on to Tax.

http://www.hmrc.gov.uk/cnr/faqs_general.htm#3nr

plus this on DTAs

http://www.hmrc.gov.uk/cnr/app_dtt.htm

Key points:

Income arising in UK including pensions is usually taxed in UK regardless of where you live, and are resident.

But, because some countries you might be resident in charge tax on worldwide income, you could pay twice. If this occurs you could claim back thru the UK, via a double tax treaty/agreement (DTA).

It isn't usually your choice where to pay. So in Thailand's case if the Thai Revenue was charging you tax on your income, you could use the DTA to ensure you didn't suffer twice.

In practice I've never come across anyone paying Thai tax on their UK pension. Technically it is possible to pay tax on some forms of UK personal income depending on when it is brought in here and thru what route - though it's rare.

Bottom line if the Thai taxman claims you must pay tax (unlikely) and you do so, you use the DTA to cliam back if used in UK. Otherwise a non-issue.

Sorry BigToe

Your UK pension will be taxed in UK. Unless you get some IFA trying to sell you a QROP to generate some nice fee income for himself.

Edited November 12, 2009 by fletchsmile

[chiang mai]

Indeed that sounds the most likely, a QROPS angle, I shudder when I think about it all!.

[fletchsmile]

BTW In case someone really wants to offer money to the Thai tax authority, and they want a scenario:

Liability to tax on foreign source income arises if:

- Taxpayer is a resident

- Derives foreign source income in a tax year; and

- Remits the foreign source income to Thailand in the same year as the income is derived.

Even then you would be able to claim a Foreign Tax Credit (FTC) if you paid tax already in the UK, although the FTC is limited to the Thai tax payable so you can't gain by the process

But the legal way round this, should you choose not to do so is:

- Income remitted to Thailand in a subsequent year by a resident is not subject to personal income tax.

- Need to be able to prove income remitted is income of a prior year.

- Avoid tainting prior year income with current year income if a remittance will take place in the current year.

Edited November 12, 2009 by fletchsmile

[chiang mai]

All good stuff and true, but I'm keen to hear back from the OP with hopefully some more details about all of this, please don't let our ramblings thus far prevent you from doing so.

[BIGTOE3]

All good stuff and true, but I'm keen to hear back from the OP with hopefully some more details about all of this, please don't let our ramblings thus far prevent you from doing so.

I sure as hxxl don't think rambling at all. I thought your links Fletch very helpful thanks.

I am particularily interested how Capital Gains Tax would be treated if you were a non-resident / tax excile. IE sale of a Company AFTER you became non-resident / Tax Excile.

Yes Fletch I am disappointed that income or dividends still taxed at source - BUT happy at only 22% IF I am right.???

BT

[chiang mai]

I can't answer all your questions since the rules have changed significantly since I went down that route years ago, what I can add is:

1) The rules for becoming non-resident for tax purposes have changed in the past four years so you will need to look into what is required today, I do not believe that 260 days even comes close to doing the business.

2) Non residency for tax purposes is generally disallowed by HMRC where the applicant still has revenue or potentially revenue generating interests in the UK. So, if you still have a home in the UK, or indeed a company, there will be problems ahead!

Hope this helps

[melbat]

I can't answer all your questions since the rules have changed significantly since I went down that route years ago, what I can add is:

1) The rules for becoming non-resident for tax purposes have changed in the past four years so you will need to look into what is required today, I do not believe that 260 days even comes close to doing the business.

2) Non residency for tax purposes is generally disallowed by HMRC where the applicant still has revenue or potentially revenue generating interests in the UK. So, if you still have a home in the UK, or indeed a company, there will be problems ahead!

Hope this helps

Hello to everyone who has replied to this tread.... To be honest very confusing! I wish I could paste the letter I had from the Inland Revenue and I hope it would address many of the questions that have been raised but basically it says-: The country you now live may also tax your pension income, under the tax law of that country. If you find that your pension income from the UK is taxable in the country which you live, you may wish to claim relief from UK tax under the terms of the double taxation treaty between the UK and that country.

If everything is in order when I receive your claim I will tell your pension payer(s) to make future payments without deduction of UK income tax. END

Now to me it's saying you dont have to pay tax on your pension if you are living in Thailand. My question is will it be better for me to be taxed here or in the UK? Also I have to get the form stamped by the tax Office here in Thailand. Where do I go for that!

As i said all very confusing!

Thanks for all your replies.... Melbat

[wordchild]

I can't answer all your questions since the rules have changed significantly since I went down that route years ago, what I can add is:

1) The rules for becoming non-resident for tax purposes have changed in the past four years so you will need to look into what is required today, I do not believe that 260 days even comes close to doing the business.

2) Non residency for tax purposes is generally disallowed by HMRC where the applicant still has revenue or potentially revenue generating interests in the UK. So, if you still have a home in the UK, or indeed a company, there will be problems ahead!

Hope this helps

Hello to everyone who has replied to this tread.... To be honest very confusing! I wish I could paste the letter I had from the Inland Revenue and I hope it would address many of the questions that have been raised but basically it says-: The country you now live may also tax your pension income, under the tax law of that country. If you find that your pension income from the UK is taxable in the country which you live, you may wish to claim relief from UK tax under the terms of the double taxation treaty between the UK and that country.

If everything is in order when I receive your claim I will tell your pension payer(s) to make future payments without deduction of UK income tax. END

Now to me it's saying you dont have to pay tax on your pension if you are living in Thailand. My question is will it be better for me to be taxed here or in the UK? Also I have to get the form stamped by the tax Office here in Thailand. Where do I go for that!

As i said all very confusing!

Thanks for all your replies.... Melbat

this is all very odd! I am not aware of a new taxation treaty between the UK and Thailand being signed yet, though one is due to be in the fairly near future .It is possible if you are resident in certain countries to have your UK pension benefits paid gross of UK tax ,and you can opt to pay your tax in your country of residence but,the existing treaty (between Thailand and UK) specificaly excludes gross UK pension payments for people who are resident in Thailand. Either a new treaty has been ratified and we have all missed it or, there has been a cock up, and it should not have been sent to a Thai resident; give the revenue a call ,they are (nearly) always pretty helpful

Edited November 12, 2009 by wordchild

[chiang mai]

I can't answer all your questions since the rules have changed significantly since I went down that route years ago, what I can add is:

1) The rules for becoming non-resident for tax purposes have changed in the past four years so you will need to look into what is required today, I do not believe that 260 days even comes close to doing the business.

2) Non residency for tax purposes is generally disallowed by HMRC where the applicant still has revenue or potentially revenue generating interests in the UK. So, if you still have a home in the UK, or indeed a company, there will be problems ahead!

Hope this helps

Hello to everyone who has replied to this tread.... To be honest very confusing! I wish I could paste the letter I had from the Inland Revenue and I hope it would address many of the questions that have been raised but basically it says-: The country you now live may also tax your pension income, under the tax law of that country. If you find that your pension income from the UK is taxable in the country which you live, you may wish to claim relief from UK tax under the terms of the double taxation treaty between the UK and that country.

If everything is in order when I receive your claim I will tell your pension payer(s) to make future payments without deduction of UK income tax. END

Now to me it's saying you dont have to pay tax on your pension if you are living in Thailand. My question is will it be better for me to be taxed here or in the UK? Also I have to get the form stamped by the tax Office here in Thailand. Where do I go for that!

As i said all very confusing!

Thanks for all your replies.... Melbat

My take on this is that there are two issues, the first is the Revenue is making you aware of the double taxation agreement between the UK and Thailand and telling you that you will not be taxed twice - the second issue is they are suggesting that if you total income is below the taxation threshold your pension will be paid gross. Regrettably for you I don't see that they are offering you a gross payment, just because you live in Thailand.

[melbat]

I can't answer all your questions since the rules have changed significantly since I went down that route years ago, what I can add is:

1) The rules for becoming non-resident for tax purposes have changed in the past four years so you will need to look into what is required today, I do not believe that 260 days even comes close to doing the business.

2) Non residency for tax purposes is generally disallowed by HMRC where the applicant still has revenue or potentially revenue generating interests in the UK. So, if you still have a home in the UK, or indeed a company, there will be problems ahead!

Hope this helps

Hello to everyone who has replied to this tread.... To be honest very confusing! I wish I could paste the letter I had from the Inland Revenue and I hope it would address many of the questions that have been raised but basically it says-: The country you now live may also tax your pension income, under the tax law of that country. If you find that your pension income from the UK is taxable in the country which you live, you may wish to claim relief from UK tax under the terms of the double taxation treaty between the UK and that country.

If everything is in order when I receive your claim I will tell your pension payer(s) to make future payments without deduction of UK income tax. END

Now to me it's saying you dont have to pay tax on your pension if you are living in Thailand. My question is will it be better for me to be taxed here or in the UK? Also I have to get the form stamped by the tax Office here in Thailand. Where do I go for that!

As i said all very confusing!

Thanks for all your replies.... Melbat

My take on this is that there are two issues, the first is the Revenue is making you aware of the double taxation agreement between the UK and Thailand and telling you that you will not be taxed twice - the second issue is they are suggesting that if you total income is below the taxation threshold your pension will be paid gross. Regrettably for you I don't see that they are offering you a gross payment, just because you live in Thailand.

Sorry Sir.. but I beg to differ....It states in the letter from the HM Revenue & Customs and I quote=: " If everything is in order when I receive your claim, I will tell your pension payer(s) to make future payments WITHOUT DEDUCTION OF UK INCOME TAX. What is that if not a offer of gross payment? If you private me your e-mail add.. I will send you a copy of the letter in full for your consideration.

Edited November 13, 2009 by melbat

[chiang mai]

As I said earlier I am at the limit of my knowledge on this one and will be happy to hear from others who can confirm or deny the situation re tax. As things stand I do not believe that the UK Revenue allows UK derived income to be paid free of tax once the tax free threshold has been reached, simply because a person is resident overseas. But I'm happy to be proved wrong by someone more knowledgeable.

You might find it useful to read the following thread which discusses the same subject and the answers seem to support my current view:

http://www.thaivisa.com/forum/Paying-Tax-U...si-t163968.html

[fletchsmile]

[Hello to everyone who has replied to this tread.... To be honest very confusing! I wish I could paste the letter I had from the Inland Revenue and I hope it would address many of the questions that have been raised but basically it says-: The country you now live may also tax your pension income, under the tax law of that country. If you find that your pension income from the UK is taxable in the country which you live, you may wish to claim relief from UK tax under the terms of the double taxation treaty between the UK and that country.

If everything is in order when I receive your claim I will tell your pension payer(s) to make future payments without deduction of UK income tax. END

Now to me it's saying you dont have to pay tax on your pension if you are living in Thailand. My question is will it be better for me to be taxed here or in the UK? Also I have to get the form stamped by the tax Office here in Thailand. Where do I go for that!

As i said all very confusing!

Thanks for all your replies.... Melbat

Thank you for posting this. Basically the confusion comes from your posts, and wording rather than the practices . First you posted

I recently had a letter from the Inland Revenue in the UK. They ask me as I have been living in Thailand for some years do I wish to be taxed in Thailand or in the UK as the UK has a double taxation treaty with Thailand.

This suggests you could choose. As stated above in my earlier post it is not your choice.

This is different from your follow up post, which reflects what we would expect

The country you now live may also tax your pension income, under the tax law of that country. If you find that your pension income from the UK is taxable in the country which you live, you may wish to claim relief from UK tax under the terms of the double taxation treaty between the UK and that countr

Basically you shouldn't find that Thailand is taxing you. In the unlikely event they do, you might be able to claim under a DTA. (Thailand no.1546 of 1981), which could be followed thru my above links and selecting the 100+countries and T for Thailand

http://www.hmrc.gov.uk/international/treatiest.htm

So all the answers are already above really: you don't have a choice. If Thailand do somehow claim and make you pay tax(very unlikely), you might be able to use the DTA.

As I very much doubt Thailand is claiming tax from you it all becomes irrelevant. So, sit back and relax and enjoy your retirement.

Edited November 13, 2009 by fletchsmile

[wordchild]

As I said earlier I am at the limit of my knowledge on this one and will be happy to hear from others who can confirm or deny the situation re tax. As things stand I do not believe that the UK Revenue allows UK derived income to be paid free of tax once the tax free threshold has been reached, simply because a person is resident overseas. But I'm happy to be proved wrong by someone more knowledgeable.

You might find it useful to read the following thread which discusses the same subject and the answers seem to support my current view:

http://www.thaivisa.com/forum/Paying-Tax-U...si-t163968.html

The Uk revenue does allow UK derived income to be payed gross of tax to a non resident indevidual in certain circumstances dependent on the relevant double taxation treaty . In the case of the gross payment of pensions you need to request it. Whether or not they allow it depends upon the taxation agreement between the UK and the country where you are resident. In the current UK/Thai treaty there is a specific exclusion of gross pension payments for UK citizens living in Thailand (and vice versa). I suspect the letter the OP recieved is just a mistake and best cleared up by calling the revenue.

Edited November 13, 2009 by wordchild

[chiang mai]

As I said earlier I am at the limit of my knowledge on this one and will be happy to hear from others who can confirm or deny the situation re tax. As things stand I do not believe that the UK Revenue allows UK derived income to be paid free of tax once the tax free threshold has been reached, simply because a person is resident overseas. But I'm happy to be proved wrong by someone more knowledgeable.

You might find it useful to read the following thread which discusses the same subject and the answers seem to support my current view:

http://www.thaivisa.com/forum/Paying-Tax-U...si-t163968.html

The Uk revenue does allow UK derived income to be payed gross of tax to a non resident indevidual in certain circumstances dependent on the relevant double taxation treaty . In the case of the gross payment of pensions you need to request it. Whether or not they allow it depends upon the taxation agreement between the UK and the country where you are resident. In the current UK/Thai treaty there is a specific exclusion of gross pension payments for UK citizens living in Thailand (and vice versa). I suspect the letter the OP recieved is just a mistake and best cleared up by calling the revenue.

Sorry, yes agreed that gross payments are allowed for non-residents but as you say, pensions are excluded and I had intended to imply that.

[stranger-in-paradise]

Many thanks to the posters. I am preparing to move to Thailand, and getting finance straight beforehand is always better than trying to fix things afterwards.

Referring to the comment made by Fletch

"But the legal way round this, should you choose not to do so is:

- Income remitted to Thailand in a subsequent year by a resident is not subject to personal income tax.

- Need to be able to prove income remitted is income of a prior year.

- Avoid tainting prior year income with current year income if a remittance will take place in the current year."

Are there any recommendations in terms of separate bank accounts to handle UK pension income (or separate banks?) to help in avoiding contamination?

Or is there a good tax accountant that could be recommended in Bangkok?

Thanks.

[wordchild]

Many thanks to the posters. I am preparing to move to Thailand, and getting finance straight beforehand is always better than trying to fix things afterwards.

Referring to the comment made by Fletch

"But the legal way round this, should you choose not to do so is:

- Income remitted to Thailand in a subsequent year by a resident is not subject to personal income tax.

- Need to be able to prove income remitted is income of a prior year.

- Avoid tainting prior year income with current year income if a remittance will take place in the current year."

Are there any recommendations in terms of separate bank accounts to handle UK pension income (or separate banks?) to help in avoiding contamination?

Or is there a good tax accountant that could be recommended in Bangkok?

Thanks.

As well as having a Thai account for living expenses, the key is to set-up an offshore account (as a savings account) ,outside Thailand and, probably best, outside the EU and clear of EU influence.You can then use this account as a buffer between your non-Thai income and your Thai bank account. Remit your external income to the offshore account and from time to time you can remit funds from your "offshore savings" to Thailand taxfree. Singapore is a top-class banking centre with a full range of offshore services and probably a good place for you to consider for offshore banking.

Edited November 15, 2009 by wordchild

[orlov]

If you are living abroad and have a UK private pension you should definitely be getting it into a QROPS as soon as possible, unless it's very small, say under £30,000. If you don't you will simply be taxed on your UK pension income under standard UK income tax rates. If you are already drawing an OAP then this amount will be added to your privale pension income for UK tax purposes. Getting your pension into a QROPS need not be complicated and can be moved across 'in specie' meaning that your pension investments don't need to be sold and re-purchased. I would highly recommend that you engage an IFA to help you because the choices are huge and yes he will charge you for this but it's worth it when considering the amount of tax you will save over the rest of your life (not to mention the pleasure of denying Mr. Brown the tax that he'll otherwise take from your life-time savings). By the way I am NOT an IFA myself. Your pension income will then be paid gross and you are supposed to report your income to the revenue authorities in the country in which you reside. But this is entirely your responsibility and HMRC will not require any paper work to prove that you have done it. After 5 years of non-residency your off-shore provider will no longer need to report your pension details to HMRC so if you have already lived abroad for, say, 3 years and move into a QROPS your provider will only need to report to HMRC for a further 2 years. After the 5 years has elapsed you will almost certainly be able to get your pension funds out of a 'pension wrapper' altogether so then the money/investments are yours to do what you like with. As a start check out "QROPS Bureau" web-site. They give genuine impartial advice but do not themselves sell QROPS.

[prakhonchai nick]

I have been watching the tax aspect for many years.

Basically as I understand it you can only elect to have your pensions paid gross if you have effectively relinquished all ties with the UK. It does not seem to matter where you are resident, but more importantly where you are domiciled.

If you have family in the UK or property then you are regarded as domiciled. If you never go to the UK and have no property there you can ask to be non-domiciled, and THEN you can request your pension paid gross

So far as Thai tax is concerned, I believe the pension is taxed at normal Thai rates (after giving various allowances ) but only if the monies are bought into Thailand in the tax year they are paid. If the money bought into Thailand ha been held by you for at least 1 yearoutside Thailand, then I understand it is not taxed.

[alfieconn]

If you are living abroad and have a UK private pension you should definitely be getting it into a QROPS as soon as possible, unless it's very small, say under £30,000. If you don't you will simply be taxed on your UK pension income under standard UK income tax rates. If you are already drawing an OAP then this amount will be added to your privale pension income for UK tax purposes. Getting your pension into a QROPS need not be complicated and can be moved across 'in specie' meaning that your pension investments don't need to be sold and re-purchased. I would highly recommend that you engage an IFA to help you because the choices are huge and yes he will charge you for this but it's worth it when considering the amount of tax you will save over the rest of your life (not to mention the pleasure of denying Mr. Brown the tax that he'll otherwise take from your life-time savings). By the way I am NOT an IFA myself. Your pension income will then be paid gross and you are supposed to report your income to the revenue authorities in the country in which you reside. But this is entirely your responsibility and HMRC will not require any paper work to prove that you have done it. After 5 years of non-residency your off-shore provider will no longer need to report your pension details to HMRC so if you have already lived abroad for, say, 3 years and move into a QROPS your provider will only need to report to HMRC for a further 2 years. After the 5 years has elapsed you will almost certainly be able to get your pension funds out of a 'pension wrapper' altogether so then the money/investments are yours to do what you like with. As a start check out "QROPS Bureau" web-site. They give genuine impartial advice but do not themselves sell QROPS.

As far as i understand the benefits of putting your money into a QROPS are as follows :

You do not have to pay any tax on your income.

Investing the money is more flexible.

In some jurisdictions you can take 30% as a lump sum not 25% as in England, i have also heard that you can take 100% as a lump sum but this seems to be a bit of a grey area !

In some jurisdictions it works at 50 years old and not at 55 as it has just been raised too in the UK.

No IHT on the pension is due on death.

Hopefully this will be of help to somebody and seems to be a case of "you know it makes sense Rodney''

[wordchild]

Qrops can be a good idea for a long-term expat and i have one myself. The one caveat I would add is be careful where you go for advice there are some real sharks operating in this area. Much better to use a UK based , UK regulated IFA for example than any kind of offshore advisor. In particular stay away from Thai based IFA,s who have a very poor reputation

[chiang mai]

Qrops can be a good idea for a long-term expat and i have one myself. The one caveat I would add is be careful where you go for advice there are some real sharks operating in this area. Much better to use a UK based , UK regulated IFA for example than any kind of offshore advisor. In particular stay away from Thai based IFA,s who have a very poor reputation

Agreed, very much so!

But a note also to an earlier poster who talked about the issue of domicile, residency is fairly easy to change, domicile is much less so, as one learned scholar put it, "domicile is not a raincoat that can be put on or taken off at will", take note.

[GuestHouse]

The OP has stated his private pension is already 'In Payment' a QROPS is therefore no longer and option.

But for anyone considering a QROPS keep in mind that if you move overseas and stay overseas then the tax benefits of a QROPS would increase your income.

However, if at a later date you return to the UK then you would face punitive tax penalties.

This needs to be kept in mind, especially given the storm gathering over Thailand's political arena right now. The man stirring up all the trouble has been humiliated by the British Government and worse still has had a huge amount of 'his?' money seized by the UK Authorities under Anti Money Laundering Laws.

Don't rule out a vindictive response if he ever gets back in the job again.

[Maximus33]

If you are living abroad and have a UK private pension you should definitely be getting it into a QROPS as soon as possible, unless it's very small, say under £30,000. If you don't you will simply be taxed on your UK pension income under standard UK income tax rates. If you are already drawing an OAP then this amount will be added to your privale pension income for UK tax purposes. Getting your pension into a QROPS need not be complicated and can be moved across 'in specie' meaning that your pension investments don't need to be sold and re-purchased. I would highly recommend that you engage an IFA to help you because the choices are huge and yes he will charge you for this but it's worth it when considering the amount of tax you will save over the rest of your life (not to mention the pleasure of denying Mr. Brown the tax that he'll otherwise take from your life-time savings). By the way I am NOT an IFA myself. Your pension income will then be paid gross and you are supposed to report your income to the revenue authorities in the country in which you reside. But this is entirely your responsibility and HMRC will not require any paper work to prove that you have done it. After 5 years of non-residency your off-shore provider will no longer need to report your pension details to HMRC so if you have already lived abroad for, say, 3 years and move into a QROPS your provider will only need to report to HMRC for a further 2 years. After the 5 years has elapsed you will almost certainly be able to get your pension funds out of a 'pension wrapper' altogether so then the money/investments are yours to do what you like with. As a start check out "QROPS Bureau" web-site. They give genuine impartial advice but do not themselves sell QROPS.

As far as i understand the benefits of putting your money into a QROPS are as follows :

You do not have to pay any tax on your income.

Investing the money is more flexible.

In some jurisdictions you can take 30% as a lump sum not 25% as in England, i have also heard that you can take 100% as a lump sum but this seems to be a bit of a grey area !

In some jurisdictions it works at 50 years old and not at 55 as it has just been raised too in the UK.

No IHT on the pension is due on death.

Hopefully this will be of help to somebody and seems to be a case of "you know it makes sense Rodney''

I think these comments just go to show how much misinformation there is on QROPS. If I can add I am a pension expert and have only dealt with pensions (no sales) for many years.

£30,000 into QROPS is crazy, with a fund that small, charges would be very high and you wouldn't be able to obtain an income high enough to be subject to UK income tax anyway, due to personal allowances. £75,000 fund is far more like the lowest for QROPS.

QROPS Bureau DO sell QROPS. They wont give you a brochure without you giving them your personal details. What are they going to do with those I wonder?

The 5 year non UK resident rule get bandied about like it it means you can do anything after. You can't. What it means is you have some small extra leeway in how you take benefits depending on your QROPS jurisdiction.

If you heard you can take 100% lump sum out, this is because many companies are misselling, don't believe them, a maximum of 30% of the fund can be taken depending on the jurisdiction of the QROPS.

Otherwise spot on!

[manhattan55]

If you are living abroad and have a UK private pension you should definitely be getting it into a QROPS as soon as possible, unless it's very small, say under £30,000. If you don't you will simply be taxed on your UK pension income under standard UK income tax rates. If you are already drawing an OAP then this amount will be added to your privale pension income for UK tax purposes. Getting your pension into a QROPS need not be complicated and can be moved across 'in specie' meaning that your pension investments don't need to be sold and re-purchased. I would highly recommend that you engage an IFA to help you because the choices are huge and yes he will charge you for this but it's worth it when considering the amount of tax you will save over the rest of your life (not to mention the pleasure of denying Mr. Brown the tax that he'll otherwise take from your life-time savings). By the way I am NOT an IFA myself. Your pension income will then be paid gross and you are supposed to report your income to the revenue authorities in the country in which you reside. But this is entirely your responsibility and HMRC will not require any paper work to prove that you have done it. After 5 years of non-residency your off-shore provider will no longer need to report your pension details to HMRC so if you have already lived abroad for, say, 3 years and move into a QROPS your provider will only need to report to HMRC for a further 2 years. After the 5 years has elapsed you will almost certainly be able to get your pension funds out of a 'pension wrapper' altogether so then the money/investments are yours to do what you like with. As a start check out "QROPS Bureau" web-site. They give genuine impartial advice but do not themselves sell QROPS.

As far as i understand the benefits of putting your money into a QROPS are as follows :

You do not have to pay any tax on your income.

Investing the money is more flexible.

In some jurisdictions you can take 30% as a lump sum not 25% as in England, i have also heard that you can take 100% as a lump sum but this seems to be a bit of a grey area !

In some jurisdictions it works at 50 years old and not at 55 as it has just been raised too in the UK.

No IHT on the pension is due on death.

Hopefully this will be of help to somebody and seems to be a case of "you know it makes sense Rodney''

I think these comments just go to show how much misinformation there is on QROPS. If I can add I am a pension expert and have only dealt with pensions (no sales) for many years.

£30,000 into QROPS is crazy, with a fund that small, charges would be very high and you wouldn't be able to obtain an income high enough to be subject to UK income tax anyway, due to personal allowances. £75,000 fund is far more like the lowest for QROPS.

QROPS Bureau DO sell QROPS. They wont give you a brochure without you giving them your personal details. What are they going to do with those I wonder?

The 5 year non UK resident rule get bandied about like it it means you can do anything after. You can't. What it means is you have some small extra leeway in how you take benefits depending on your QROPS jurisdiction.

If you heard you can take 100% lump sum out, this is because many companies are misselling, don't believe them, a maximum of 30% of the fund can be taken depending on the jurisdiction of the QROPS.

Otherwise spot on!

Also, someone said to be careful as it regards Thai IFAs ("real sharks"). That may be true, but there are some reputable people out there as well. I switched over to a QROPS last year, it was done by my UK finance guy out of Bangkok (he has a weekly column in the Bangkok Post). No problems to report so far.