Moving Pension to Malta

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FANTANA

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Tax-Efficient Pension Strategies for High Earners

In this episode, Paul sits down once again with Aidan McLoughlin, Group Managing Director of ITC, to discuss how pensions can be used far beyond traditional ...
youtu.be

I recently watched the above YouTube video on moving your pension to Malta with ITC. I had heard of this before but had thought it meant taking up residency there but that appears not to be the case.

I haven’t seen much discussion here on this topic and as per the clip there seems to be little downsides. Does anyone have experience in moving their pension to Malta?
 
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Whats the advantage of trfing pension to Malta?

Before someone hits me with a link, I have checked the link above and it aint jumpin out at me.

Assume its tax advantageous? Is that it?

Cheers.
 
ArthurMcB said:
Whats the advantage of trfing pension to Malta?
Click to expand...
It was briefly popular during the great recession, when some people thought all pensions and bank accounts were at risk of being confiscated. Other than that, the advantage was that it allowed a lot more people get higher charges from the pension.
 
Malta allows a higher TFLS to be taken from the pot too. Though I can't see how the difference between the Irish TFLS and the Maltese lump sum wouldn't be taxed in Ireland at the higher rate.
 
miser said:
Malta allows a higher TFLS to be taken from the pot too. Though I can't see how the difference between the Irish TFLS and the Maltese lump sum wouldn't be taxed in Ireland at the higher rate.
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You can take 30% rather than 25%, but if your pot is smaller (like 650k) then that amount may still be under the 200k limit, so an extra 32.5k tax-free.

May be beneficial for couples with asymmetric pension values, where one person has a significantly smaller pot than the other.
 
The other benefit that I’m aware of is that an ARF is not recognised as a pension in most other countries, therefore may be double-taxed. Whereas the Maltese structure is not necessarily an annuity but still recognised as a pension in e.g. Spain.
 
I get that the Maltese Revenue will let you take out 30% rather than the Irish 25%. However, if you are living in, domiciled in, and resident in Ireland, then surely Irish Revenue will want to tax that extra 5% when it lands in your AIB current account?

If you have a €2m pot, that’s the difference between a 600k TFLS (Malta) & a 200k TFLS (Ireland). Can an Irish retiree really keep that €400k without the lads in Dublin Castle taking a cut? I’d have thought not- because if you could, I’d expect the financial advisor community would be publicising it more!

Makes sense with a smaller pot as per your example, but with a smaller pot you have to weigh up the cost of implementing the move to Malta vs the tax saving benefit.
 
This might be relevant here:
As I originally mentioned and linked to, there are several existing threads on the issue of moving one's pension abroad today may already answer questions that might crop up.
 
And another post/thread on this topic...

Has anyone transferred his/her pension to Malta?

The way you're angling your last few posts it's as if you think that I'm arguing that all advisers should know all details of all countries at all times. If that's not what you're suggesting, then what exactly are you suggesting? You brought up Malta. If I start recommending Malta to my...
www.askaboutmoney.com
 
There is an EU internal market for investment services. You are not obliged to use a provider in your country of residence.

Am not sure how Revenue are competent to adjudicate over what is and what isn’t a bona fide reason and what isn’t.
 
My understanding is that the references to "bona fides" in threads that I linked were mainly or solely @Marc Westlake explaining the test that his own company (Everlake) applied when deciding whether or not they would facilitate moving a pension abroad for a client. I don't think that it referred to any test that Revenue apply?
 
Found it:

"It is the responsibility of all trustees and PRSA providers to ensure full compliance with the
requirements of the Occupational Pension Schemes and Personal Retirement Savings
Accounts (Overseas Transfer Payments) Regulations 2003. These Regulations were made by
the Minister for Social and Family Affairs (the title of the office at that time) in exercise of
powers conferred by the Pensions Act 1990. In essence, prior to making any overseas
transfer payments, the trustees or PRSA provider must be satisfied that:
(a) the member or PRSA contributor has requested a transfer,
(b) the overseas arrangement provides relevant benefits as defined by section 770
TCA, and
(c) the overseas arrangement has been approved by the appropriate regulatory
authority in the country concerned.
To comply with (b) and (c) above, the trustees or PRSA provider should obtain written
confirmation from the administrator of the overseas arrangement to which the transfer is to
be made."
 
Fortune said:
Ok, I read the transcript of the linked video, Malta doesn't have a deemed distribution and allows the post retirement fund to be split on your will. Relatively niche benefits for HNW individuals.
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Open to correction, but it's my understanding Malta won't charge tax on payments out of their equivalent of an ARF if you're resident in a country outside Malta with which Malta has a DTA. There are many such countries and some of them have very attractive tax rates.

Revenue, on the other hand, will absolutely will charge you tax on ARF distributions, no matter where you are. If you're lucky, you might be able to claim some back, if your ARF provider is able to provide the necessary information and there's a DTA in place.
 
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