New UK Pension Rules

[skippy]

As of April 15th 2015, people in the UK can now draw down funds from their pensions even while working from the age of 55. Plus under the new 'freedom' rules there are other beneficial features from a tax perspective. See http://www.theguardian.com/money/2014/oct/14/uk-pension-reforms-what-mean

My question; obviously our government is miles behind on pension reform here in Ireland ... however given the QROPS (recognised overseas pension by HMRC) ... could moving a pension to the UK be worth it ?

At first glance, it certainly would appear so! and I'm sure this is catching the eye of many in the know.

 

[Conan]

I would question whether "our government is miles behind on pension reform" simply on the basis of the recent UK changes.
As I understand it, the UK changes will apply only to Defined Contribution schemes (not Defined Benefit). However we have had the ARF facility in Ireland for DC schemes since 1999 and if anything the UK is following Ireland's example. Our ARF structure allows DC members to access all their residual fund (after any tax-free lump sum and perhaps the first €63,500 for an AMRF) in the form of an income drawdown. But as in the UK any drawdown is subject to tax.
There are other issues where Ireland could do with some pension reform, but on the UK changes I would argue that we are some 15 years ahead of the UK. They are copying us?

 

[Gerry Canning]

I would question whether "our government is miles behind on pension reform" simply on the basis of the recent UK changes.
As I understand it, the UK changes will apply only to Defined Contribution schemes (not Defined Benefit). However we have had the ARF facility in Ireland for DC schemes since 1999 and if anything the UK is following Ireland's example. Our ARF structure allows DC members to access all their residual fund (after any tax-free lump sum and perhaps the first €63,500 for an AMRF) in the form of an income drawdown. But as in the UK any drawdown is subject to tax.
There are other issues where Ireland could do with some pension reform, but on the UK changes I would argue that we are some 15 years ahead of the UK. They are copying us?

..............


In Uk state pension compared to most EU states is miserly.
The average work pension fund in Uk is small, so now rather than having a steady (albeit small) bit of extra cash from that pension fund , pensioners can spend that pot and rely on their miserable UK state pension.
So now in Uk they are permitting even small funds be spent and then pensioners are left with the UK,s miserly old age pension.
Methinks our AMRF/ARFs are much more nuanced and sensible!.

 

[Steven Barrett]

Agree 100% with Conan. Besides the ridiculous AMRF (which now allows a 4% pa withdrawal), we have this provision since 1999.

In the UK, there is a lot of press about people being aware of conmen getting pensioners to part with the pension pots. I have never heard of someone being conned out of their pension pot...in fact, I have never come across someone taking the taxable cash option at retirement.

Steven
www.bluewaterfp.ie

 

[Wiggins]

I had requested a small old pension plan of mine in the UK to be transferred to Ireland. I have just been informed by Zurich Ireland that they will no longer accept transfers from the UK? Something to do with the QROPS change in the UK last April. Is this the same with all of the other Irish Insurance companies - New Ireland, Friends First etc?

 

[Steven Barrett]

I had requested a small old pension plan of mine in the UK to be transferred to Ireland. I have just been informed by Zurich Ireland that they will no longer accept transfers from the UK? Something to do with the QROPS change in the UK last April. Is this the same with all of the other Irish Insurance companies - New Ireland, Friends First etc?

I read something about changes alright. I can't remember where I saw it though. I'll try to root it out and put up an update.

With the changes to the UK pension rules, the HMRC has asked all QROPS scheme managers to restrict access to the pension fund to age 55. For company pensions or BOB's that are QROPS approved, the access is from age 50. That is where your problem lies.

Standard Life are going to amend their product features on the QROPS BOB to reflect the HMRC changes.

If you transfer it to a QROPS BOB, after 6 years, you can transfer it to an ordinary BOB that doesn't have this restriction (a transfer within 6 years is a reportable event that would trigger exposure to unauthorised payments tax in the UK).


Steven
www.bluewaterfp.ie