QROPS Pension Transfers

People living and working abroad who want to move their pension overseas often find that transferring into a Qualifying Recognised Overseas Pension Scheme (QROPS) is the most viable option.

To help you decide whether this is the best course of action for you, we’ve put together this comprehensive article which covers:

Completing a UK pension transfer into a QROPS can be quite a complex affair. Once you’ve read the details below if you’d like to speak with a QROPS specialist make an enquiry and we can arrange for an expert to get in touch.

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What is a QROPS pension transfer?

A qualifying recognised overseas pension scheme (QROPS) is a pension plan domiciled in a country or territory outside the UK which has been approved by HM Revenues & Customs (HMRC) as suitable for pension transfers from UK-based schemes.

UK Pension transfers to a QROPS are known as ‘recognised transfers’ and can usually be made without any tax deduction if the member satisfies certain criteria.

To receive HMRC approval a QROPS must meet the following requirements:

  • The scheme must be recognised for tax purposes by the equivalent tax authority of the country or territory where it is based
  • The scheme must also be recognised by an appropriate, locally-based, regulator to ensure the administration can be monitored accordingly
  • No retirement benefits are allowed before the age of 55
  • The scheme must be based in an EU member state or a country where the UK has a tax information exchange agreement

It is the responsibility of the administrator of a QROPS to inform HMRC that the scheme meets all of these requirements. You can view a list of schemes that have informed HMRC of their eligibility here.

Can I transfer my pension to a QROPS?

Yes, it’s possible. If you live and work outside the UK or are considering doing this and you have an existing pension fund which will become dormant as a result of your move you can consider transferring your UK pension to a QROPS in the country where you are, or will be, based.

What are the advantages and disadvantages?


  • Having all of your pension funds within the same territory where you reside rather than spread across different jurisdictions (particularly if your intention is to remain in this country into retirement)
  • Your employer offers a QROPS with attractive benefits
  • Favourable tax treatment for retirement income in your country of residence
  • Pension drawdown can commence from age 55
  • Flexible access to funds with no obligation to purchase an annuity
  • Access to a wide range of international investment funds
  • A range of currency options available


  • Making a transfer from a UK pension to a QROPS could incur a 25% tax charge
  • Potential risk of HMRC withdrawing their recognition of the QROPS your funds are in at anytime in the future
  • Benefits of the QROPS may not match those provided by your UK pension
  • Advisors fees and charges levied by the provider could be high and reduce the value of your transfer fund
  • Exchange rate fluctuations if the QROPS is not based in the territory where you live

Before you decide to transfer your UK pension to a QROPS it’s strongly advised to seek the guidance of a professional pensions expert. If you get in touch we can arrange for an advisor we work with to contact you and discuss further.

When does the 25% tax charge apply?

Since March 2017, recognised transfers from a UK pension to a QROPS have attracted a 25% overseas transfer charge. However, this charge does not apply under the following circumstances:

  • You are joining a QROPS occupational pension scheme as an employee of an employer who is sponsoring the scheme
  • Your country of residence is the same as the QROPS domicile where you’re transferring the funds
  • You’re resident in a country within the European Economic Area (EEA) and the QROPS you are transferring to is domiciled in another EEA territory
  • You’re transferring to a QROPS run by an international organisation (EU, United Nations) as an employee
  • You’re transferring to a QROPS public service pension scheme as an employee of an employer who sponsors the scheme

The charge also does not apply if you made a transfer request before 9 March 2017 and this has not yet been completed.

However, it does apply if you have failed to provide all the correct paperwork when making your transfer (outlined in more detail below). You can request a refund, via your scheme, at a later date if you can confirm you satisfy any of the criteria outlined above.

If your circumstances change at any stage within five years of making the transfer (moving to a non-qualifying territory for example) then the 25% overseas transfer charge may apply at that point.

If you are considering transferring your UK pension to a QROPS and you are concerned about whether the 25% tax charge will apply, make an enquiry and we can arrange for an expert to get in touch to discuss your situation in more detail.

An overview of the transfer process

The QROPS pension transfer process follows a similar path to that required for a transfer between different UK pension schemes. In the first instance you should write to your UK scheme administrator or provider and inform them of your intention to transfer your pension fund to a QROPS.

The administrator then has 30 days to confirm the value and the details they require for the transfer to proceed. You then have 60 days to provide all the information required. If you fail to do this in the time allocated the UK scheme administrator is obliged to take a 25% overseas transfer charge from the fund value if the transfer proceeds.

As a scheme member the details you will be expected to provide include:

  • Personal details (including current or most recent UK address)
  • The date your UK residence ended if you’ve already left
  • Details of QROPS including HMRC reference number (if known)
  • Country/territory where QROPS is domiciled
  • Written confirmation that any transfer to a non-recognised QROPS will give rise to further tax charges (up to 55% of the pension transfer value)

Unlike transfers between UK schemes a QROPS transfer is classed as a benefit crystallisation event (BCE) and, therefore, is assessed against your lifetime allowance (currently £1.055 million). If your pension pot exceeds the allowance a tax charge of 25% can be applied (lower than the typical 55% as it is not a payment direct to a member).

If you’re considering moving forward with a transfer to a QROPS and would like to speak with an expert regarding the process, get in touch and we can arrange for an advisor we work with to speak with you.

Should I transfer my final salary pension?

Generally speaking, transfers from a final salary pension (also known as a defined benefit scheme) to another pension scheme – either UK based or a QROPS – are not recommended as the benefits a member can receive usually far outweigh what others can provide.

However, there may be legitimate reasons why a member may wish to transfer out of such a scheme.

If you’d like to find out more about the benefits and drawbacks of this type of transfer, make an enquiry and we can arrange for a pensions specialist to get in touch.

NHS pension transfers

NHS pensions would fall under the category of ‘unfunded defined benefit pension schemes’. As such, transfers out of these type of pensions are not permitted which includes transferring to a QROPS.

UK pension transfer to non-QROPS

In short, it is possible but most experts would not recommend it. Transfers to a non-QROPS are classified as ‘unrecognised’ and would incur an unauthorised member payment tax charge equal to 40% of the transfer value. This amount can rise by a further 15% if any unauthorised pension payments during a 12 month period are higher than 25% of the pension fund value.

Speak to an expert

Transferring your pension to a QROPS certainly has lots of potential benefits, however, it is quite a complex area of financial planning that requires lots of careful thought and deliberation.

If you’re moving, or have already moved, overseas and want to take your pension fund with you it’s really important you seek professional advice before making a final decision.

If you have questions and want to speak to an expert for the right advice, call us today on 0808 189 0463 or make an enquiry here.

The advisors we work with have a wealth of experience in areas such as this and deal with customers in your situation all the time.

We can arrange a free pension review for you today

70% of customers who have a pension review find a better deal

We can arrange a free pension review for you today

70% of customers who have a pension review find a better deal

Tony has worked in a vastly diverse array of areas in the pensions industry for over 2 decades. Tony regularly writes for trade press, usually on topical and pensions pieces as well as acting as a judge at prestigious national events. Tony is also a highly qualified Independent Financial Adviser in his own right. His mantra has always been "Hope for the best, but PLAN for the worst", and believes that the biggest impact that an adviser can have on a client's life journey is to take them on a journey from generally having little or no real idea of what their retirement will look like, to giving them the understanding of what their retirement looks like now, then helping them navigate a path to what they WANT their retirement to be.

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