QROPS planning is not a one-size-fits-all pension

Saving tax is the main selling point of a QROP (Qualifying Recognised Overseas Pension Scheme) according to most advisers, but these are often the wrong considerations for judging whether a particular pension plan is right for you.

HM Revenue and Customs work hard to try and maintain consistency in more than 1,000 QROPS plans offered across 40 countries by policing how pension providers are applying the small print in the rules.

In theory, the terms and conditions of a QROPS should be the same wherever you choose to open the plan.

That’s where the ‘qualifying’ term comes from in the name - a QROPS is only a QROPS if the plan meets the rules laid down by HMRC.

Matching strategy to fund performance is crucial

The real question is which QROPS provider’s plan best meets your personal retirement strategy, not how a QROPS can save you tax or how much cash can be drawn down.

Any QROPS provider will ensure someone opening a scheme has ‘best advice’ from someone like a QROPS Adviser consultant.

Our advisers are fully conversant with QROPS worldwide and tailor a scheme to match your financial objectives.

Besides all the usual financial planning safeguards, a QROPS Adviser consultant will make sure that you consider several factors that affect your fund:

• Tax on fund growth in the country where your scheme is opened
• Tax on income in the country where you intend to retire
• How currency fluctuations between your fund and where you live impact on your spending power
• Fund performance and management comparisons between different QROPS providers

QROPS Adviser tailors a QROPS plan to suit you

These are just a few of the points that can make a big financial difference when you retire - so yes, a QROPS can save a British expat or international worker with UK pension rights tax.

Other benefits include no obligation to buy an annuity and passing on your fund without inheritance tax when you die.

Just remember these are the hooks to get you in the door.

What you really need is what QROPS Adviser provides - full whole-of-the-market knowledge to pick the right QROPS for you.

For instance, one fund manager may outperform rivals in emerging market investments while another may be ahead on commodities.

Every QROPS plan should save you tax, but not many advisers will have the depth of knowledge to make sure you sign up for the right plan.