Expats with frozen UK pensions will be very aware of HMRC’s efforts to clamp down on popular QROPS products in offshore locations around the world. However, there is good news for existing members of the Aurora QROPS with both HMRC and the Guernsey Income Tax Office agreeing to granting them grandfather rights moving forward.
The Guernsey Government took big steps to close their domestic based QROPS to new members and the Aurora scheme is now delisted from HMRC. The scheme will continue to exist for existing members.
Historic transfers into the scheme are guaranteed as being safe and the UK Inheritance Tax position is preserved. Members are advised that they do not need to take any action.
HMRC has provided written confirmation that all transfers prior to the date that a QROPS product no longer meets their requirements are safe and valid. Therefore existing members will not be disadvantaged as a result of the QROPS being delisted.
The HMRC Technical Guidance notes describe the position:
“Transfers to the scheme made before withdrawal of its QROPS status, or its exclusion from being a QROPS, will be recognised transfers so they will not give rise to an unauthorised payments charge (or surcharge) on the member or to a scheme sanction charge on the administrator.”
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