The UK government’s move on Wednesday to kick start the official two-year process for leaving the European Union is likely to be a further blow to a Qrops industry still reeling from the shock 25% charge imposed earlier this month.
Several more firms are at risk of being sanctioned by the Financial Conduct Authority (FCA) as the regulator steps up action against international IFA firms specialising in overseas pension transfers, says Tim Searle, chairman of Dubai-based advisory firm Globaleye.
The UK Financial Conduct Authority has ordered Holborn Assets Ltd to immediately cease all pension transfer business, particularly that introduced by overseas advisers.
The UK government’s shock decision to impose a 25% charge on transfers to foreign pension schemes announced in the Spring Budget could go as far as to “shut down” the Qrops market, according to industry observers.
The trouble with retirement planning is that there are many different rules and regulations as successive governments add their stamps to the way we save for and use our pension pots.
DeVere UK has stopped providing advice on overseas pensions transfers, a spokesperson has confirmed to International Adviser.
The Financial Conduct Authority (FCA), the UK’s financial services regulator, is currently investigating overseas pension transfers as part of a move to tackle widespread investment fraud, according to Paul Davies, director of advisory firm bdhSterling.
A court ruling against HM Revenue & Customs on a case about inheritance tax (IHT) is unlikely to change the current two-year exemption rule on pension transfers, said Rachael Griffin, financial planning expert at Old Mutual Wealth.
The Financial Conduct Authority (FCA) has issued a stark warning to firms advising on domestic and international pension transfers after reports that some clients are being scammed or their funds transferred into unsuitable investments.
The Isle of Man Financial Services Authority (IoMFSA) has advised residents to tread carefully when making decisions about transferring or investing their pensions, following a rise in scams in the UK.
A UK court has ruled that a £75,000 ($92,106, €87,429) loan taken out by a client to fund investments as part of a pension transfer was a form of pension liberation and should be subject to tax.
Providers of recognised overseas pension schemes (Rops) have voiced concerns over the UK’s plan to scrap the advice safeguard for expats, with some arguing that the move may create a “consumer protection gap”.
