Announced on Tuesday, the draft legislation has taken much of the QROPS industry by surprise. Yesterday, some members of the industry began to react to the events, however the Isle of Man is the first major QROPS jurisdiction to release any formal statement on the legislation.
In its statement, Stuart Clifford, chairman of the Isle of Man Association of Pension Scheme Providers (APSP) said the association welcomed the proposed changes.
“APSP welcomes HMRC’s invitation to consult on the draft regulations issued on the 6th December in relation to the transfer of UK pension schemes overseas for UK expatriates.
“The draft regulations provide for the combat of abusive schemes which have previously been offered by some countries. It is also pleasing to see the proposed introduction of new material that will have to be provided to transferring members for consideration before transfers can proceed. Naturally the APSP will be working with local industry and Government to ensure that QROP schemes continue to be available post April 2012 should the proposed changes be introduced by the UK Government.”
The Isle of Man’s minister for economic development, John Shimmin, was similarly upbeat about the announcement. He said: “Clarity and ensuring abuses are eradicated are in everyone’s best interest. The APSP will have the Government’s support in ensuring we maintain our excellent reputation in retirement solutions and that the Isle of Man offering remains competitive.”
Statements from representative bodies in Malta and Guernsey are expected over the next few days.
Speculating on the potential outcome of the proposals, Geraint Davies, managing director of UK-based specialist QROPS adviser Montfort International, said HMRC had employed a “pincer movement” on those providers operating outside the intended use of QROPS.
He said: “While it is still not 100% clear what the outcome of the draft legislation will be, it is clear that for those who think the door is closing on their dodgy practices the door has already closed.
“I believe there is a strong possibility HMRC will begin to look back over historical cases with a view to seeing whether or not they complied with the intention of the overseas pension regulation.”
