HMRC Issues Further QROPS Guidance After Judicial Review

By Editorial 16 December, 2013

HM Revenue and Customs has conceded that a list it published relating to Qualifying Recognized Overseas Pension Schemes was misleading until a caveat was added on September 24, 2008, and it has confirmed that it will no longer pursue tax relating to transfers into schemes included on the list before this date where there is no evidence of tax avoidance or evasion.

In June, the tax body abandoned a High Court action against investors in a scheme which had been removed from the list in 2012, and the presiding judge demanded that HMRC should explain its position on QROPS.

QROPS were introduced in April 2006, and they allow a UK taxpayer's pension entitlements to be transferred tax-free to another jurisdiction where he or she is seeking permanent residence. However, a scheme has to meet certain conditions in order to achieve QROPS status.

HMRC publishes a list of schemes that have notified HMRC that they meet these conditions, but it now admits that before September 24, 2008, the list may have given the misleading impression that the schemes had received HMRC approval. The list is maintained for the benefit of scheme administrators.

HMRC warns that transfers into a scheme that is not a QROPS can lead to a tax charge of 55 percent on the amount transferred.

Tags: Tax | Revenue Guidance | United Kingdom | HM Revenue And Customs (HMRC) | HM Revenue And Customs (HMRC) | Expats | Pensions | Pensions |


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