Momentum head of pensions John Batty said the company, which currently provides QROPS to clients in more than 50 countries, is “pretty sure we are the only ones who are doing this”.
Momentum currently administers pensions out of offices in Malta and the Isle of Man, and says it is in the process of adding other “high quality” jurisdictions, which for the moment it declines to name.
Explaining the thinking behind the new policy, Batty said: “With clients being internationally mobile, and international tax regulations changing, [and] more Double Tax Agreements being signed, we felt it was only right that our clients should not be penalised, should the jurisdiction they are in be unsuitable [at the point] when they begin to take income from their pensions.
“Momentum may have a suitable product in the jurisdiction required, but if not, we will waive all of our surrender and transfer penalties on transfer to another provider.”
The penalty-free transfer will only apply when the transfer is to another QROPS; existing legislation permits it; the client is “commencing income”, and Momentum does not offer a QROPS in an equally-suitable jurisdiction.
Momentum already permits its clients to move their QROPS between the Isle of Man and Malta without charge.
Not ‘one-size-fits-all’
Momentum chief executive Mark Gaywood said that as the market for Qualifying Recognised Overseas Pension Schemes matures – it dates back to April 2006, when new UK legislation made such overseas pensions possible – it is becoming increasingly apparent that a one-size-fits-all QROPS strategy will not work.
“We are firm believers that there is not one singular QROPS jurisdiction that can be right for every client, hence our multi-jurisdictional approach,” Gaywood said.
“We believe that it is difficult to make a choice of jurisdiction that the adviser or the client can guarantee will always be right, and as circumstances can change, we do not want the client to be in a situation [in which] he is penalised for events outside his control.”
To read a a blow-by-blow comparison of the Isle of Man, Malta, New Zealand and Gibraltar as QROPS jurisdictions, click here.
