HMRC may only have introduced Non-UK Pension Schemes (or QNUPS) in February 2010, but they are already proving to be an excellent pension opportunity for UK residents as well as UK expatriates, especially as the current UK government pension support is looking so bleak. Whereas previously UK taxpayers could rely on the stability and support of their government pension fund, now if you’re looking forward to retirement it’s likely that feel insecure about how you will manage financially. If you’re confused about your eligibility or want to learn more about QNUPS benefits, this handy guide to QNUPS will help answer your questions.

What are QNUPS?

With the launch of QNUPS, those with investment assets located in the UK can now transfer their investments to a QNUPS without being liable for UK inheritance tax or Capital Gains Tax (CGT) charges on growth within the trust. The same criteria as for QROPS apply when establishing a QNUPS: the QNUPS must be established outside the UK and the country in which it is established must recognize it for tax purposes and regulate it as a pension scheme. So now that the facts and figures are out of the way and QNUPS is explained, how can you take advantage of this financial opportunity?

What are the benefits of a QNUPS?

There’s no upper age limit as long as you’re still working, so you can keep contributing, even if you’re past your retirement date.

The income and assets you deposit into QNUPS can come from any source; it does not have to come directly from employment.

The limit on the amount of money you invest in your QNUPS is significantly above the reduced amounts the government now allows in UK pensions.

You can withdraw up to 30% of the balance as a lump sum before withdrawing your retirement income.

QNUPS are exempt from UK inheritance and inheritance tax laws, meaning you can maximize the residue of your QNUPS inheritance you leave behind.

There are more tax benefits than just inheritance tax, as there is no annual or lifetime tax allowance cap on a QNUPS, unlike UK personal pensions where total tax-free amounts drop to £40,000 per year, or £1.25 million over a lifetime.

Funds in a Gross QNUPS statement; in other words, they compound outside the tax umbrella to a much greater extent, and tax is only paid when they are finally remitted to the UK, for example, they sell an investment property and there is no CGT on the sale gain. Same with equity portfolios.

QNUPS are effectively viewed by HMRC as a pension trust; therefore, like a UK pension, they are out of bankruptcy proceedings and cannot be divided in a divorce.

Am I eligible to get a QNUPS?

Whether you’re a UK resident or an expat living abroad, you may be able to take advantage of a QNUPS. The following list illustrates the criteria you must meet:

You must be at least eighteen years old; there is no maximum age limit

All UK residents or those domiciled in the UK (domicile is determined by birth) are entitled to take out a QNUPS.

Non-UK residents who currently have assets located in the UK are also eligible.

There are many cases where a QNUPS can be very beneficial, and not just for UK expats with UK pensions. If you already have assets in the UK and want to create a larger tax-exempt platform in a much quicker time and want to reap the benefits of a scheme with effectively tax-free caps, then a QNUPS could be the most effective way to protect your retirement. money.