HMRC Drops Cyprus from Approved QROPS List

Expat Globe

All Cypriot qualifying recognised overseas pension schemes (QROPS) have been removed by HM Revenue & Customs from their approved list of schemes. Cyprus has been on the approved list since the offshore pension regime began in 2006.

The news follows HMRC’s crackdown on QROPS which follows the new rules and regulation introduced in April this year when 400 QROPS were closed to new business. 300 of these schemes were based in Guernsey and were closed after non-residents and residents were obliged to pay the same rate of tax under the new laws.

Tax on pension paid income from a Cypriot QROPS was just 5% with 30% available as a tax free lump sum. No tax has to be paid on unused QROPS assets in the event of death.

There were five such schemes operating in Cyprus. Their removal follows on from the removal of Singapore’s in 2008. Hundreds of other individual schemes have also been omitted.

The list of providers self-certifying their pensions compliant with QROPS pension rules in the UK includes over 2000 schemes across 48 countries.

QROPS are normally only delisted when they are closed, the provider asked for greater confidentiality or if the QROPS have been removed due to inability to comply with the rules. One reason that Cyprus may have been removed is because there is no pensions regulator in Cyprus.

HMRC have not issued a statement in relation to this latest omission.

There are still many viable QROPS out there so expats are advised to consult an IFA to work out their best options.