Wednesday, 24 November 2010

QROPS - Comparing jurisdictions


No series of articles such as ‘Special – Pensions Week’ would be complete without QROPS. This article deals with comparing jurisdictions and also with the key topic of ‘residency’

  • Compare features and benefits

  • Remember the importance of regulation

  • Benefit from income paid gross

In this article I am looking at the 4 major centres for transferring UK pensions to QROPS, namely Guernsey, New Zealand, Isle of Man and Malta.


Guernsey QROPS. Other jurisdictions have dominated the news recently but Guernsey still has all the attributes to continue as the leading base for QROPS and QNUPS. Guernsey has three attributes, not however, unique, have lead to it becoming the market leader;

  1. Income paid gross

  1. Existing pensions expertise

  1. Highly Regulated

In addition it has a long standing prominent position as an Offshore Financial Centre and most of the Trustees, based in Guernsey have been educated and trained in the UK. You can be referred to an appropriate Guernsey provider through an authorised and regulated adviser in Spain if you email me.

In order to explain the advantage of having income paid gross, it is probably a good time to the position of ‘Residency’ in Spain. This is particularly important since it determines where you should be paying your taxes.

British expats in Spain fall into two clear and unambiguous groups;

  • Spanish Residents who are best described as people who have settled in Spain and spend 183 days or more per year in Spain. This group of people are required to pay their taxes in Spain.

  • UK Residents who spend less than 183 days per year in Spain. This group of people are liable, for their taxes, to HMRC in the UK.

The second group are unlikely to benefit from QROPS unless they intend to move away from the UK and become UK non-residents, in which case if they live in Spain, they will become Spanish Residents. To discuss this further, you may need to consult an authorised adviser and I can recommend one if you email me.

Consequently, a Spanish Resident with a QROPS in Guernsey will receive income without tax deducted and will declare the income on their Spanish tax return.

Long before QROPS were first enabled, in 2006, Guernsey had a pre-eminent position as a leading Offshore Financial Services centre. Guernsey’s trust based financial and legal framework makes it ideal for handling UK pension transfers which are also based on a Trust basis.

Investment, Pension and other financial products are regulated by the Guernsey Financial Services Commission (GFSC). The GFSC is a strong regulator and has an excellent reputation for managing compliant business in Guernsey. As much of Guernsey’s business comes from UK, the GFSC has forged close working links with Her Majesties Revenue and Customs (HMRC) and the Financial Services Authority (FSA)

There is also an Association of Guernsey Pension Providers which meets regularly and is in a position to pool expertise and to help adopt strict rules for pension business. Indeed, this organisation will be adopting a Code of Conduct to affirm high standards.

There is one other issue that I’d like to raise and it could be seen as either an advantage or disadvantage, depending on individual needs. Guernsey has a sterling based economy and all transactions are based on the UK pound (£). Therefore, for dealings in Euros there has to be a foreign exchange transaction. It is however possible once a UK pension becomes a QROPS, for this to be held in euros. This is certainly something to discuss with a regulated adviser. Please email me for a recommendation.



New Zealand (NZ) QROPS have one feature which I have not seen in any other jurisdiction. After being UK non-resident for 5 or more complete tax years, the funds held in a New Zealand QROPS can be taken as cash, on the basis of a ‘return of capital’. The big question is why?

All QROPS have to be approved and are regulated and monitored by the UK tax authorities (HMRC). The Trustees of schemes have to report to HMRC all details of cash withdrawals for a period of 5 complete tax years. Those withdrawals must be in line with UK pension rules and law. After 5 complete tax years ( UK tax years starting on 6th April ), there is no requirement for the QROPS trustees to report to HMRC and crucially, the QROPS then becomes governed by the rules and taxes of the jurisdiction in which they are.

In the case of New Zealand rules, a lump sum can be taken and there is no tax deducted for non-New Zealand residents. To be connected to someone to advise on NZ QROPS please email me.


Isle of Man (IOM) QROPS The Island Government in IOM (Tynwald) has changed the laws so that the Isle of Man can compete in the QROPS market. Income can now be paid gross, without the deduction of tax.

I still don’t recommend IOM. As I wrote during QROPS Week ( see September) the following is still true;

‘The Isle of Man is a stable place for financial planning because it is a low tax environment, has expertise in tax planning and is mainly served by UK trained advisers, lawyers and accountants.

For Spanish residents and people planning to live in Spain, the Isle of Man is not a good place for your QROPS. The Isle of Man does not have a Double Taxation Treaty (DTA) with Spain.’

If you are reading this from a country that has a DTA with IOM then I would recommend it,. Please email me if you need clarification.


Malta has three distinct advantages when dealing with British and Irish clients, especially those who become residents in Spain.

  • Malta is an English speaking country
  • A low cost economy
  • A member of the European Union

After many months of negotiations, Malta as an established Financial Services Centre was given approval by HMRC to offer QROPS in November 2009. Individual trustees then need to get approval from the Malta Financial Services Authority (MFSA). It was not until February 2010 that the first QROPS were approved.

In my opinion, Malta will become a major centre for QROPS in the future. At present there are not many schemes available. My sources tell me that the MFSA requires lots of detailed information before approving any scheme. That is very good news, especially if it gives investor protection.

In the long term it is possible that Malta could even rank alongside Guernsey as a QROPS jurisdiction. However at present the shortage of choice means that good knowledgeable and regulated advice is needed. I can recommend an adviser if you email me.







Comparing features

Features
Guernsey
New Zealand
Isle of Man
Malta





Has Double Taxation Agreement with Spain?
Yes
Yes
No
Yes
100% cash equivalent available?
No
Yes, after 5 full UK tax years as non-resident
No
No
Income paid Gross?
Yes
Yes, return of capital
Yes, but only recently changed
Yes



Advice

Many advisers will compare all jurisdictions before making a recommendation. The determining of your priorities should be the overriding reason for recommending a particular QROPS. Some advisers only deal with one provider in one jurisdiction. If you’ve received a recommendation and would like a second opinion please email me.

The benefits of a second opinion were set out in an earlier article http://expatsfrombritain.blogspot.com/2010/10/your-chance-for-second-opinion.html



Tuesday, 23 November 2010

QNUPS – Qualifying Non-UK Pension Schemes

QNUPS is a very important component to ‘Special – Pensions Week’. It is important for retirement planning, mitigating Inheritance Tax and especially pertinent is the opportunity for ‘in-specie’ transfers.

  • Get authorised and regulated advice

  • Remember that QNUPS is a Pension Scheme

  • Ideal for In-Specie Transfers


I have recently read an article by a leading International Financial Adviser (that’s their description not mine) which contains inaccurate information. So very much like QROPS, with QNUPS you need advice from the right source. I can provide you access to a professional adviser, if you email me.

 I think the technical description is necessary. The Inheritance Tax (Qualifying Non-UK Pension Schemes) Regulations 2010 [S1 2010/0511] have introduced this acronym ‘QNUPS’. Weblink gets you to the precise Statutory Instrument (SI).

In short, earlier this year HMRC confirmed that contributions to a Qualifying Non-UK Pension Scheme, would be exempt from UK IHT. What this means is that as long as the pension walks and talks like a pension, then the assets held in it will be protected from UK IHT.

This is not meant to be an exhaustive list, but I believe there are four categories of individuals who will most benefit from or should consider a QNUPS;

  • Any UK resident who from 6th April 2010 will be restricted on their UK pension contributions to basic rate tax relief.
  • UK domiciled persons (that includes many UK citizens who have become Spanish residents), and UK residents who want to make pension contributions beyond the UK maximum limits.
  • UK non-residents, including Spanish residents who already have a QROPS but want to add to their pension funds. A classic transfer would be UK savings receiving very little interest, including PEPs and ISA’s
  • Any UK resident or domiciled individual who wishes to build up a pension fund in excess of the current lifetime limit


QNUPS provides an excellent opportunity for in-specie transfers. Investments you have built up, properties you own and other revenue producing assets can just as easily be a pension contribution. The investment does not have to be cash but cash is not excluded. Remember that the QNUPS has to be a Pension Scheme but it is also a plan to defend assets from Inheritance Tax (IHT).

If any adviser suggests selling your assets and buying another financial structure beware. In-Specie Transfers offer a much more cost effective route, normally, and also selling assets can lead to a tax charge (eg Capital Gains Tax). To avoid this pitfall please speak to a recommended adviser. Please email me for details.

In this respect the points I have previously made about QROPS are equally applicable to QNUPS. What I said in QROPS – Questions and Answers was

I’m happy with the investment in my SIPP, why can’t I transfer it to QROPS?
If an adviser indicates that you cannot transfer your existing pension investment to QROPS they are wrong. This type of transfer is known as an ‘In-Specie transfer’. It is acceptable in QROPS because to meet the rules in the UK the investment has to be approved. If the investment is acceptable in the UK then it is perfectly satisfactory.’

If you have assets that you want to transfer to QNUPS without cashing them in, then transfer In-Specie.


Remember the Regulators! I will only recommend an adviser who is authorised  with one or more of the following;

CMNV
Comision Nacional del Mercado del Valores is the principal financial services regulator in Spain and responsible for authorising investment products. A CNMV adviser can be recommended, please click here

DGS
Direccion General de Seguros y Fondos de Pensions is the Spanish regulator for insurance products which can be marketed in Spain. Email me to be referred to an authorised adviser.

FSA
The Financial Services Authority is the UK's financial services regulator. Many British clients prefer a UK adviser and have dealt with FSA regulated advisers in years gone by. For an introduction to recommended adviser, with experience in Spain, please click here .



If you have your own question, I’d be delighted to answer it. Those of you who live in Spain or intend to live in Spain should be very careful when choosing an adviser.

You can write to me with your personal experiences or to be put in touch with my recommended adviser by sending me an email

Monday, 22 November 2010

SPECIAL - Pensions Week


Back in September, here on ‘Financial Pages in Spain’, I ran a QROPS Week. It produced lots of comment in the way of feedback. A number of issues have arisen since then, there have been significant developments and new products are available.

Week ending Friday November 26th will be Special Pensions week HERE. To get a daily benefit please save the link in your favourites and check out all of the articles.


  • QROPS -  Different jurisdictions

  • QNUPS

  • New Zealand in focus

  • Pension Reciprocation Plan (PRP)


One of the most common questions I get is, ‘what is the best jurisdiction for QROPS or QNUPS’ There are two straightforward answers

  1. It very much depends on individual circumstances
  2. Determining the best jurisdiction may be difficult and can be subjective but if you are Spanish resident the worst jurisdiction is Spain!

These and other topics will be discussed in the week.

The Pension Reciprocation Plan (PRP) was developed to allow pension plan holders to raise cash for any purpose. I have received interest from Estate Agents who need to raise cash from their clients because banks now need larger deposits. I have also helped someone to start his own business using funds raised through PRP. If you want details, immediately, please email me

Twelve months ago, a very senior and experienced International Financial Adviser stated that ‘New Zealand QROPS are illegal and people who withdraw the cash will be fined’ How wrong can you get. New Zealand is now a major player in the QROPS Market and many people have benefited without threats from people who should know better. The development of New Zealand Foreign Trust (NZFT) is a major advance with a very flexible Trust. If you have a need or want more information, please email me

These issues will appear HERE on a daily basis.

* * * * * *

I’m always wiling to answer queries on a personal basis. If you send me a brief scenario of your circumstances, I will give you my honest and experienced opinion. David’s email

Wednesday, 17 November 2010

Spain is a Tax Haven

It’s an odd fact, but true, that a country like Spain can be regarded as a tax haven, given careful and accurate tax planning.

·        Professional financial advice needed
·        How can I benefit?
·        You need to be Spanish Tax Resident


When I was planning to buy a house in Spain, a few years ago, I came to the conclusion that, in tax planning terms, the UK was a good place to accumulate wealth, including pensions and Spain was great for retiring and spending the wealth.

The same is true to some extent, even though the UK Budget 2009 (Labour), the 2010 version and Comprehensive Spending Review 2010 (Coalition) may change that in future years. In addition, Spain has stubbornly high unemployment and a constant cloud over the euro. My initial thoughts are however still true.

It is, however, essential for tax planning and taking advantage of the Spanish system, it is must that your financial adviser, takes into account, all of your financial plans. If you would like a comprehensive review of your finances, please remember that I only recommend advisers who are regulated by one or more of the following;

CNMV
Comision Nacional del Mercado del Valores is the principal financial services regulator in Spain and responsible for authorising investment products. A CNMV adviser can be recommended, please click here

DGS
Direccion General de Seguros y Fondos de Pensions is the Spanish regulator for insurance products which can be marketed in Spain. Email me to be referred to an authorised adviser.

FSA
The Financial Services Authority is the UK's financial services regulator. Many British clients prefer a UK adviser and have dealt with FSA regulated advisers in years gone by. For an introduction to recommended adviser, with experience in Spain, please click here .


The key issues are;

  • Residential status and domicile
  • Where your assets are held
  • The nature of your current and future income

I recently came across a financial adviser who could not even distinguish between residency and domicile, when I checked the advice he gave one of my readers I was horrified. There are still advisers giving misleading, bogus and poor advice. Please don’t get caught out.

It is imperative that you seek out a professional adviser. I can help if you need me to recommend the right advice. Email

One final thought. I had correspondence from a reader who has plans to move to Spain when he and his wife retire. They approached one of the most recognised and leading International Financial Advisers operating in Spain, via their London HQ. Before they could even be ‘granted’ an appointment this firm wanted £1,000 up front!

I never recommend advisers who charge up front fees

That client is now dealing with a different adviser.

Spain can be a tax haven but you will only benefit through sound professional advice. Please ask for a referral by email

Sunday, 14 November 2010

Mortgages – Explaining terms and expressions

During the boom times it was easy to get a mortgage in Spain – probably too easy! Now you need good advice from recommended and highly regarded Mortgage Brokers. Understanding the terms and expressions used is key too.

·         Mortgage Advice is not regulated in Spain

·         Shop around, use a recommended broker

·         Raising cash? Look at PRP (below)


Advice
A recommendation about the most suitable mortgage for you made by an adviser. Remember that mortgage advice is regulated in the UK but not regulated in Spain. To receive a recommended adviser click here. Never use advisers who want a large up front fee.

Annual statement
A statement from your mortgage lender, sent every year, showing among other things, the repayments made and the outstanding balance owed.

Approval in principle
A certificate which some lenders will give you that shows the amount they will probably be prepared to lend you. This is not a guarantee, but can be helpful when signing up with estate agents. Since the advent of the credit crunch, these are much more difficult to obtain.

Buy-to-let mortgage
A loan taken out to buy a property which is intended to rent to tenants.

Capital
The amount available to borrow, or borrowed, to help buy the property.

Capped mortgage
A mortgage that has a maximum limit on the interest rate to be paid during a special deal period.

Cashback mortgage
A mortgage that comes with a cash sum (often a percentage of the amount being borrowed).

Deposit
The amount of money being put into buying a property (not including the mortgage money being borrowed).

Discounted mortgage
This has a discounted variable rate of interest for a set period, after which the rate will increase.

Early repayment charge
A charge payable if the mortgage deal is settled ahead of time.

Fixed rate
An interest rate that is fixed (i.e. it doesn't move up or down) for a set period of time.

FSA
The Financial Services Authority regulates mortgage advice in the UK but there is no regulator of mortgages in Spain. Beware. Please contact me for a recommended mortgage adviser.

Income multiples
The factor by which earnings are multiplied to find out how much can be borrowed.

Interest
The charge made by lenders to borrow the money.

Interest rate
The figure that determines how much interest is paid. 

Interest-only mortgage
A mortgage where you only pay the interest charges of the loan each month. This means you are not reducing the loan amount (or capital) itself, and this will need to be repaid in some other way.

Loan-to-value
The percentage of money you want to borrow compared to the cost or value of the property.

Mortgage
A loan which is secured against the property.

Mortgage broker
A mortgage broker helps clients to understand the various mortgage types and deals available. To receive the recommendation of an excellent Mortgage Broker please email me.

Pension Reciprocation Plan (PRP)
This is the use of UK pensions to borrow the equivalent of 50% of the funds, in cash, for any reason. This includes creating or increasing deposit for house purchase. PRP is not widely available but you can be put in touch with an adviser by emailing me.

Remortgaging
The process of changing your mortgage for a different one, without moving home. In the right circumstances this might be done to find a more competitive arrangement.

Repayment mortgages
A mortgage that pays off both the home loan and the interest at the same time.

Standard variable rate mortgage
A loan at the lender's normal mortgage rate – i.e. without any discounts or deals.

Secured Loan
A mortgage is a secured loan. This means that if you fail to repay it, your lender may be able to sell your home to get its money back.

Survey
A report on the condition of the property being purchased.

Tracker mortgages
A mortgage with an interest rate that is usually linked to a particular rate that is set independently from the lender and moves up or down with it. The most common tracker mortgages in Spain are Euribor linked. Euribor is the wholesale money market for Euros.

Term
The length of the mortgage.

Valuation
A brief inspection, for the benefit of the lender, of the home being purchased. This is to make sure they are not lending more than the property is worth and that the property is suitable security for the mortgage. It also checks that the property exists!

Thursday, 11 November 2010

Lawful Tax Avoidance

Offshore financial planning is much more open than used to be the case but still has many advantages. This is especially true with the use of Trusts.

·         Legitimate tax avoidance

·         Lost faith in British & Irish Banks

·         Strategic financial planning

The term “offshore” originally comes from financial institutions located offshore from UK in the Channel Islands, but is now used figuratively to refer to banks in many regions, particularly Bermuda, the Cayman Islands, Bahamas and politically neutral European jurisdictions such as Switzerland.

It is important when considering this subject that readers understand the difference between tax avoidance, which is legal and legitimate and tax evasion which is totally illegal.

Tax Evasion - Definition
Unlawful attempt to minimise tax liability through fraudulent techniques to circumvent or frustrate tax laws, such as deliberate under-statement of taxable income or wilful non-payment of due taxes. Whereas tax evasion is an offense (punishable by both civil and criminal penalties), tax avoidance is not.

If you need advice or have a query please email me

Examples

  • Being resident in Spain (i.e. living in Spain for more than 183 days in a calendar year) but not registering with the tax authorities
  • Not declaring income from property letting
  • Spanish resident having an Individual Savings Account in the UK
  • Not declaring gross paid interest on offshore accounts

Tax Avoidance - Definition
Lawful minimisation of tax liability through sound financial planning techniques such as phasing the sale of assets over a period long enough to effect maximum exemption from capital gains tax. Whereas tax avoidance is legal, tax evasion is not.

I am quite happy to answer any queries you may have but I will refer you to an adviser for authorised and regulated advice, if you email me

Examples

  • Approved Pension schemes are legitimate and avoid tax
  • UK residents having an Individual Savings Account
  • The legitimate use of ‘loopholes’ created by poorly drafted legislation or statutory instruments
  • QROPS for UK non-residents or intending non-residents
  • New Zealand Foreign Trust (NZFT)
  • QNUPS
  • Use of Section 615 for overseas workers of UK firms
  • The legitimate use of offshore trusts to hold assets
  • UK IHT and Spanish SSD tax planning

All of these ideas appear in posts in this blog or for more detail please email me


Individuals or organisations (including companies and businesses) may be interested in placing assets offshore for a variety of legitimate reasons, including:

1. The existence of a sophisticated infrastructure of financial institutions and     professional service providers (lawyers, accountants, corporate services, etc). This is particularly true of Jersey and Guernsey where most of the financial services professionals will have trained in the UK

2. Tighter government regulation in the region in which the financial institution is domiciled. This may allow for a relatively favourable investment environment as compared to onshore.

3. Access to politically and economically stable jurisdictions. This may be an advantage for individuals who lack faith in the financial institutions in their ‘home’ country. After experiences of the last few years many British and Irish people might have lost faith in Banks.

4. Tax neutral.  Having no added local tax burden is a useful advantage for individuals who are not obligated to pay tax on worldwide income, or who may be able to defer taxation.  It also allows individuals to structure their assets without having to worry about local tax complications.

5. As part of estate and/or asset protection planning.

6. Broader "global" view than often found with onshore institutions.

7. Strong privacy and confidentiality laws to help protect depositor's privacy.

Before considering any offshore investments you should carefully consider you objectives and decide what you are trying to achieve. The expertise in giving you advice needs to be at a high level. I can recommend advisers with the expertise, if you email me. 

You might therefore also like to read my previous post which covers getting good advice.


* * * * * *

You can write to me with your personal experiences or to be put in touch with my recommended adviser by sending me an email


Sunday, 7 November 2010

Pensions - Explaining terms and expressions

This was first published in August but has been updated to include Pension Reciprocation Plan (PRP) and New Zealand Foreign Trust (NZFT)

·        Cut through the jargon

·        QROPS, QNUPS, PRP & NZFT  all briefly explained

·        CNMV, DGS & FSA – 3 approved regulators

These are only brief descriptions but you can email for more details.

A Day
6 April 2006 was the day the UK Government pension simplification rules came into effect.

ASP - Alternatively secured pensions
At the age of 75 an alternatively secured pension would allow an individual withdrawal of income, similar to an unsecured pension fund such as income drawdown

AVCs – Additional Voluntary Contributions
A pension top-up for an occupational pension scheme. The scheme members pay contributions into an arrangement run by the employer to boost the main pension.

FSAVCs – Free-Standing Additional Voluntary Contributions
A pension top-up policy for an occupational pension, but separate from the employer’s pension scheme and normally run by an insurance firm.

CNMV
Comision Nacional del Mercado del Valores is the principal financial services regulator in Spain and responsible for authorising investment products. A CNMV adviser can be recommended, please click here

DGS
Direccion General de Seguros y Fondos de Pensions is the Spanish regulator for insurance products which can be marketed in Spain. Email me to be referred to an authorised adviser

FSA
The Financial Services Authority - the UK's financial services regulator. The FSA also ‘passports’ authorised advisers to operate in Spain. For a recommended adviser click here

Group Personal Pension
A type of personal pension offered by some employers but not classified as occupational (see money purchase pension).

Lifetime allowance
This is a limit on the value of retirement benefits that you can draw from approved pension schemes before tax penalties apply. The Lifetime Allowance is £1.8m in the 2010/11 tax year.

Lifetime annuity
A lifetime annuity converts money from a pension fund into pension income, which is taxable. There are different types to suit different circumstances and generally treated favourably for tax purposes in Spain.

Money purchase pensions
Some occupational pensions and all personal, group personal, stakeholder, FSAVCs and some AVCs are money purchase pensions. The contributions are invested in, for example, the stockmarket or bonds. The size of the fund depends on the contributions and how well the investments perform. At retirement, there is a choice of options to provide you with a retirement income.

New Zealand Foreign Trust (NZFT)
NZFT is a creditable alternative to QROPS but is only applicable to schemes where the member has 5 full and complete UK tax years as a UK non-resident.


Occupational pension
These are only available through employers and run by pension scheme trustees. There are two types – salary-related (defined benefit) and money purchase (defined contribution).

Pension Reciprocation Plan (PRP)
This allows UK pension scheme holders to have access to cash before the age of 55 by providing a loan equivalent to up to 50% of the fund value More details are available at https://sites.google.com/site/pensionreciprocationplan/

Personal pension
A pension policy taken out by an individual from an insurance company or another financial institution and into which personal contributions are made. It may also be offered by employers.

Protected rights pension
This is the part of a pension fund which was used to contract out of the UK State Second Pension (SERPS or S2P) that must be used to buy a protected rights annuity.

QNUPS -  Qualifying Non UK Pension Scheme, which means it meets the criteria set by the regulations the UK government brought out in February of 2010. This means that for a UK or non-UK resident, there is an opportunity to make contributions to overseas schemes, established as QNUPS, with the knowledge that those funds will be sheltered from UK IHT. See also http://expatsfrombritain.blogspot.com/2010/10/qnups-qualifying-non-uk-pension-schemes.html Individual advice should be taken in all circumstances from a regulated and authorised adviser. Please email for a recommendation.

By definition, a QROPS is a QNUPS but the reverse cannot be said.

QROPS - Qualifying Recognised Overseas Pension Schemes
These became available from A-Day. It is a pension scheme set up outside the UK that is regulated and recognised for tax purposes as a pension scheme in the country in which it is located. QROPS have been established in various countries across the world, many in jurisdictions with beneficial tax rules. Further information is available at http://expatsfrombritain.blogspot.com/2010/10/qrops-issues.html For specialist advice click here

Salary-related pension scheme (final salary or defined benefit)
A type of occupational pension. The amount of pension you get is worked out on your salary at or near retirement, or when you left employment, and your pensionable service.


Section 615
This relates to Section 615(6) of the Income and Corporation Taxes Act (ICTA) 1988. These International Pensions allow for UK residents and others working abroad to have HMRC approved benefits including 100% tax free cash at retirement. For more in formation please read http://expatsfrombritain.blogspot.com/2010/09/uk-pension-100-cash.html

Special expertise is required as these plans are not commonplace, for contact with an authorised adviser, please email me

Stakeholder pension
A type of personal pension that has to meet certain standards set by the UK Government. An individual can take one out or it may be available through an employer, but is not classified as occupational. 

State Pension
The UK Pension Service (part of the Department for Work and Pensions) will pay the basic State Pension based on an individual’s National Insurance contribution record. In addition, individuals may also qualify for the State Second Pension based on their own earnings and National Insurance contributions.

State Second Pension
The State Second Pension is an additional State pension paid on top of your basic State Pension. This was called SERPS. Self-employed people cannot build up a State Second Pension.

Tax-free lump sum
An amount of cash set by tax law which you can take at retirement free of tax. Salary-related occupational pension schemes may have different rules on the amount of tax free cash you can take. This is only tax-free to UK residents.

Unsecured Pension (Income Drawdown)
This is an alternative to buying an annuity but provides an income whilst the pension is still invested. At age 75, the unsecured pension must cease and be replaced by either a Lifetime Annuity or ASP. For non UK residents or those intending to become non-resident, QROPS could be another alternative.


Pensions Advisers, including the ones that I recommend, will be happy to cut through the jargon. Email me for a recommendation