Thinking about retiring overseas?

It’s exciting to think about retiring in another country, but it’s important to know how this will affect your options for how you can access your UK pension savings and to find out how your UK pension savings will be taxed in your destination country.

• If you plan to live outside the UK when you retire, you may be able to access it as an income into a UK or foreign bank account.
• Transferring to an overseas scheme may be restricted if you are not a resident in the UK, so it may be a good idea to take action before leaving the UK if you’re considering this as an option.
• In the UK you can generally start to access your pension benefits from the age of 55. This is due to rise to 57 in 2028.
• You may be able to access your pension earlier if you have any pension allowance protections, such as protected tax-free cash or protected pension age. We recommend you take appropriate advice in relation to a transfer to avoid losing these protections.

An option for retiring overseas is to transfer your pension savings to a Qualifying Recognised Overseas Pension Scheme (QROPS) recognised by HMRC. This will normally allow you to transfer pension savings without attracting a UK tax charge. HMRC's Recognised Overseas Pensions Schemes (ROPS) list, provides a frequently updated list of countries and schemes that identify as meeting the conditions to qualify as ROPS.

If after you’ve considered all of your options and any financial and/or tax advice relevant to your personal circumstances, you decide that you wish to transfer to a QROPS, there is a process that will need to take place.
 

• Contact Fidelity. We will send you forms and HMRC declarations for you and your receiving pension scheme to complete. We’ll also send you a quote for the value of your pension pot to be transferred but remember this value may be different on the date of transfer as your pension will remain invested and its value can go up or down. You’ll need to complete these forms and send them back within 60 days, and usually a transfer will take 3 to 6 months from start to finish.
• Fidelity don’t charge any fees for overseas transfers, but you will have to pay a 55% tax charge on a transfer to any scheme that is not a QROPS. Even if you’re transferring to a QROPS you may have to pay a 25% UK tax charge on the transfer.
• The units held in each fund for your pension will then be sold so that the value of your benefits can be paid to the receiving scheme, that means there will be a number of working days where your savings won’t be invested in the market. Fidelity will let you know when your transfer has been completed.