The Pensioneer Trustee Company (Guernsey) Limited
T +44 (0) 1481 743760
Qualifying Non – UK Pension Schemes were introduced through a change in legislation by the UK Government on 15th February 2010. When the UK Government embarked on its major overhaul of UK pension legislation – often referred to as “A” Day - the intention had been to ensure that certain non-UK pension funds remained exempt from UK Inheritance Tax but the drafting of the earlier legislation was ambiguous in that respect.
HMRC confirmed this was an error and the legislation was updated in the Finance Act 2008, followed by The Inheritance Tax (Qualifying Non – UK Pension Schemes) Regulations 2010. These rules clarified exactly which pensions are exempt from IHT – and introduced QNUPS. As QNUPS are not registered pension schemes different rules can apply to the investments held within the fund and terms relating to the drawdowns. They provide a highly flexible and tax efficient pension structure that can supplement existing pension arrangements while remaining entirely separate and distinct. The schemes are genuine pension arrangement and as the transfer of assets is out of post-tax earnings or from personal capital, there are no reporting requirements to HMRC.
If your clients are UK resident or UK domiciled and non-resident, and have substantial assets/potential assets then a QNUPS may be beneficial. It also has the following uses:
*Unless you become a Guernsey resident tax payer
There is considerable flexibility on the assets and value of assets which can be transferred into the QNUPS. This can include cash, unlisted shares, share options, securities, commercial/residential property (excluding your principal residency) and chattels/works of art etc.
An individual may start to draw an income from the age of 55 and must draw an annuity or income drawdown before the age of 75 years. There is considerable flexibility in how this income can be taken, but 70% of the pension fund must be available to provide an income.
For individuals reviewing their financial arrangements for retirement, the QNUPS may well provide possibilities to supplement already existing schemes with opportunities for effective estate planning. QNUPS are pension plans and should be used for providing retirement benefits only, and as such HMRC are satisfied to accept them under their pension regime.
Please feel free to get in touch if you would like any further information, or to find out which of our services may be best for you or your company.
Alternatively, contact us by phone or email:-
T +44 (0) 1481 743760