qrops pension

A question about : qrops pension

I have been advised after a pension review to transfer my 2 frozen personal pensions into a QROPS pension (Harbour Pensions)...any advice?

Best answers:

• Who did the pensions review?
  A quick google shows they are a new company wit about a years record but no lists of unhappy customers as yet which is common for the worst companies.
  Where are you based and why is a romps scheme attractive to you?
• Don't do it
• Unless you are going to live abroad QROPS is unlikely to be a good idea. Personal pensions can just be moved to other UK pension schemes if there's something to dislike about the current ones.
  QROPS tends to be used for investment scams, particularly if it is a result of a cold call rather than you knowing that QROPS may be good for you and searching for advice proactively yourself. Typical scams would involve things like investing in foreign property or trees, where the sale is based on fake profit claims that the investor isn't in a position to personally verify.
• Woodface,
  No one said to not use Qrops if you were living overseas and intending to retire overseas. Which is why the question was asked.
  Do not look for conspiracies where there are none.
  Do you work for a company that does Qrops?
• Tush,
  Count the posts. Anyone who has less than 10 posts and comes on here expounding the benefits of anything that can lead the unwary into dodgy areas is likely to be attempting to sell.
  If only we got a Ј for each one that was identified then we could all retire. As a newbie we are not allowed to be too hard on him
• I did that hence my question. Which was within Newbie rules lol.
• Please do me the courtesy of not casting aspersions about what my agenda might be. Some of you guys have posted many many times over the course of years. I do not come on here speculating on your agendas, altruistic or otherwise. I am sure you have your own reasons.
  Since the question has been asked, I will answer. I have worked on both sides of the coin, as a UK and offshore IFA. When in the UK, I knew relatively little about QROPS - it does not form a part of UK financial planning. My previous view probably would have been similar to yours.
  My motivation to registering and posting was to provide some balance that I felt was lacking, especially since the original poster did not mention his location. Surely that is allowed? Some of you are keen to dismiss the idea before you know even half of the situation. I have no doubt that your client meetings in real life are more consultative than that!
  Dunstonh, you have really failed to recognise my point. The 55% tax on death is a real concern to many. Most people *do* crystallise their pensions - it is therefore not simply a theoretical notion - it affects most people once they retire.
  Secondly, regarding final salary transfers - when was the last time you requested a transfer value on such a scheme? I'd be very surprised if it was recently, assuming you are based in the UK - there is simply no place for final salary transfers there. There is a much stronger argument for final salary transfers if the client lives overseas, at least from the standpoint of death benefits.
  You also miss my point about underfunded schemes. My point is that many will offer generous transfer values to offload the liability.
  I do agree entirely however that QROPS is not suitable for UK residents.
• So you do work int he industry and have a vested interest.
  Do US the credit of mentioning it in your signature like the IFAs do?
  And we asked the OP the question of why Qrops and where they live now, as this was pertinent. In the interim, for others, then we needed to mention it could be a liberation scam. Esp if they were cold called.
  Generous transfer values virtually always fail to buy the same pension in the open market. And the PPF covers things substantially. I doubt sincerely the TV would even match the PPF.
  It would be a very limited sample who would benefit from transferring a DB pension. Incl those who are unmarried with no spouse/dependents, and those likely to die soon.
  AS this is a UK forum, we are going to have to assume, until told otherwise, those here are UK residents. So not suitable for Qrops in your own words.
• Woodface, we know that the vast majority of QROPS posts are relating to scams, not to legitimate use cases, so it's natural that the majority of the posts will initially feature the problem aspects while including a mention of the legitimate use situation so that if it turns out to be a legitimate use the person asking the question can follow up on that. Four of the five posts before yours did that.
  Nobody here has any problem at all expounding on the benefits of QROPS for suitable cases, it's just relatively unusual to encounter those. For the suitable cases it's a completely legitimate and useful tool.
  The majority of cases of death after taking benefits do not involve any need to pay a 55% tax charge. That's because the benefits paid into the pension pot of a spouse or certain types of dependent is exempt and most cases do have a spouse involved. Since the spouse will need income it's natural for the spouse to want the money to go into the pension to generate an income. Even under current rules, a 3% gilt yield and 150% GAD multiplier, a spouse who's say 85 years old or older can take out 22.5% of the pension pot value each year. A lower 8.85% if they are 65, gradually increasing to that 22.5%.
  Of course the first person could start withdrawing at the maximum rate as soon as they are able as well and that can dramatically reduce the pot size.
  For other situations there's the option of buying life cover to meet the need. QROPS can still have a place but there's a lot of 55% hype about in the QROPS promotion area and not so much explaining of how easy it is to avoid without QROPS. Do decent early planning and it'll be way less than 55%.
  That's all before the plan to allow unlimited withdrawing as taxable income arrives and makes it easy to withdraw at high rates.
  Pension discussion aside, nice to meet you.
• Hi James,
  Thank you for your post which is significantly more polite and less presumptive than some of the previous comments.
  I can appreciate now why there is some suspicion towards QROPS if UK investors are being targeted. I work with clients overseas on a face-to-face basis, so I suppose my attitude towards it is different.
  I take your point about the fact that the 55% tax can be avoided where there is a spouse; however, the resulting pot still provides an income that is taxable. One of the benefits of QROPS is that the lump sum death benefit is free of tax (at least in most jurisdictions).
  I also recognise your point about buying life cover to deal with the potential 55% tax deduction. This needs to be done early if it is to be cost-effective, and doesn't provide a means to avoid the tax - merely to replace the deduction. The problem is that many people leave their planning too late.
• yes, UK posters are being targeted in their thousands, and there are many who have been scammed down this route (a thread on page one for instance).
  If you think we were rude, then sorry. But as a newbie your first post here was also I felt rude to DH. We may have been presumptive, but our presumptions were correct- you do work in the industry. So do amend your signature to say so.
• If the company has only been formed in the past year, that would ring alarm bells with me. Most of the pension "liberation" scams are recently formed too. So I'd certainly want to be doing much more research on them.
  More oddly though, Harbour Pensions does not appear on HMRC's list of recognised QROPS here
  Taking those two things alone, I'd be avoiding this. If a QROPS is the right option, there are plenty of other schemes to choose from.
• First and foremost question is whether Stevo412 is based in the UK or not? If yes, then don't move to a QROPS. It is completely pointless as it will be treated no differently to a UK registered pension scheme.
  If you have moved abroad Stevo then yes, QROPS still have a place. For info just google "QROPS transfer benefits". Any further queries feel free to ask.
  BTW Can someone pm me on how to add a sig.
  Also, I work in the QROPS field but not as an FA. The company is linked on my profile already.