Pension savers looking for the right offshore home for their retirement savings are bombarded with options, so here’s a step-by-step guide to setting up a QROPS pension.

Take regulated, independent advice

Contact a regulated independent financial adviser – prospective QROPS investors must make contact with a provider via an IFA. QROPS schemes only take introduced business to ensure customers have had independent advice on the risks and benefits of a QROPS.

Points to watch –
  • Your adviser is regulated and knows the QROPS sector
  • Your QROPS provider is a bona fide registered scheme
  • Set-up charges
  • Ongoing charges for administering the fund or switching investments
Get a pension transfer value

Your current pension provider will give this figure – it’s generally the fund value less charges. Do not work on the current value, as the transfer value could be significantly less.

Many QROPS providers do not accept transfers of less than £100,000 - £150,000, some have their thresholds set a lot higher.

Smaller fund transfers might appeal to the pension investor, but the switch might not be cost-effective.

Select a QROPS provider

Different QROPS advisers have varying minimum incoming fund transfer values, so until your current pension administrator confirms the figure, you cannot start a transfer with confidence the fund meets the provider’s threshold.

Look at investment options. You might want flexible investments so you can self invest or just a standard arrangement to use an in-house fund manager.

Consider further transfer fees, should you want to move your money on to a different QROPS in the future.

QROPS set up

The scheme administrator has to carry out some background checks – these include standard anti-money laundering inquiries to confirm your identity and the source of the transfer fund.

The QROPS team has to have a letter of authority from the transferring pension fund agreeing to the transaction. This involves the current fund administrator confirming the proposed transfer is to a registered QROPS scheme.

The administrators also agree the final fund transfer value.

Post-transfer activity

Liaise with QROPS scheme manager over finalising investment decisions. Again, these options may vary between QROPS providers


Comments are closed.