A leading Qualifying Recognised Overseas Pension Scheme (QROPS) provider is offering a cut price deal for expats transferring their retirement savings.
As part of a focus on QROPS for British expats, STM Group has set the establishment fee for the offshore pensions at zero until March 31, 2017.
The incentive covers all STM QROPS – including pensions based in Gibraltar and Malta.
Specialist QROPS for the US and Australian markets also qualify.
STM CEO Alan Kentish explained the incentive was attracting expat customers to QROPS provided by the company.
Meanwhile, STM is keen to spread the word about a new Gibraltar ‘Australia’ QROPS with built-in foreign superannuation status.
Foreign superannuation guarantee
The QROPS has been developed to carefully comply with Australia QROPS rules set by HM Revenue and Customs (HMRC) after many superannuation schemes were removed from the QROPS list more than a year ago.
Foreign superannuation tax treatment is guaranteed for any retirement saver holding the QROPS.
This is a tax benefit in Australia that allows the fund to grow without attracting any tax.
If the fund is moved into a superannuation scheme, expats who have lived in Australia for more than six months can opt for reduced 15% tax on fund growth. This can see the expat tax on pension transfers outside the six-month exempt period drop from as high as 49%.
The QROPS also comes with the zero-establishment fee and a £750 annual trust charge.
“‘Since moving to Australia I’ve been overwhelmed by the demand from financial services professionals for a tax efficient pension transfer solution,” said Stuart Denness, the STM managing director in Australia.
“With the tax ruling, the new scheme provides clarity and certainty for the individual member. With 1.3 million British expats already in Australia, we expect demand from Australian resident expats to be high.”
STM has also launched a contract-based QROPS from Malta instead of the typical trust-based pension.
The QROPS is a solution aimed at expats in countries with legal and tax systems that do not recognise trusts.
“‘We look forward to servicing new clients and gaining a stronger foothold in those markets where there is a preference for a contract-based solution,” said an STM spokesman.