Can my client move from a QROPS to a SIPP?

In simple terms a person should, in most cases, be able to transfer a QROPS into a UK SIPP, however, there are important factors that should be considered on a case-by-case basis before doing so.

A QROPS (or Qualifying Overseas Pension Scheme) is a personal pension scheme set up outside of the UK (and regulated as a personal pension scheme in the country where it is established) but recognized by UK HMRC. QROPS can receive transfers from UK-registered pension schemes. A popular jurisdiction for QROPS transfers has been Malta.

As a result of changes to pensions and tax legislation/guidance in 2015, 2017 and even 2021, the benefits of a QROPS over a UK personal pension like a SIPP for expatriates have significantly diminished. This is particularly the case for US residents/taxpayers.

If your client is currently in a Malta QROPS, it is possible to transfer the pension assets back to the UK into a UK personal pension. Reasons for considering such a transfer can include having a more cost-effective pension structure in a jurisdiction the client is more familiar with. However, whether a transfer from a Malta QROPS to a UK SIPP is advisable will very much depend upon the client’s individual circumstances. If you would like to learn more, contact a Florin Pensions advisor.