Daniel
A transfer value with a company pension in the uk is normally free of charge. A provisional calculation and a deferred benefits calculation as well. Once you have these documents you are ready to take on any pension scheme that comes your way.
If you have a pension scheme here, there is no harm in asking them to do a quote on what benefits that could bring you. They will simply calculate what that pension is worth in their scheme and then you have figures to look at as opposed to rules and regulations of each scheme.
If anyone would like me to look at any figures they have obtained, please feel free to ask. I am not a financial advisor, but worked in the local government pension scheme which is the basis of most occupational pensions schemes around britain with a little difference here and there. I know a bit about them when i have numbers in front of me.
Tony
I have a UK pension with a transfer value approaching 100,000CHF - I have a 2nd pillar scheme here which AFAIK is not QROPS approved (I'm awaiting confirmation). I'd like to transfer my UK pension here, but it has to be to a QROPS scheme and the rest I'm not sure.
1) Can I open another 2nd pillar scheme with someone else (qrops approved), or does it have to be via my employer (which means - since I already have one, no possibility)
2) Can I or can I not transfer into a 3rd pillar scheme (qrops approved). or does it have to be a 2nd pillar scheme.
3) If the transfer is done correctly, there are no tax implications. Correct?
4) What else don't I know that I should?
TIA
2. No as this is not technically a fund but a saving scheme similar in style to Peps and the like - ie a tax free savings scheme for your old age.
3. Yes.
4. No idea!!!!
For now it does appear that unless you work for one of the employers with a QROPS fund, the recent UK legislation is effectively redundant for transfers into Swiss schemes and this is unlikely to change given the burden of reporting imposed by good old nanny state GB.
There are a number of offshore routes open however. It does appear that if you transfer your fund to a QROPS then that QROPS is only obliged to behave like a UK pension scheme if you have been non-resident in the UK for less than 5 whole tax years. Thereafter a distribution is subject to the jurisdiction of the QROPS itself, so for example in NZ you can access 40%, and in some others there is no compulsion to buy any annuity for example, and/or you can access it age 50.
I have nothing to do with these guys but here's what I found (google "QROPS five year rule")
http://www.premierfinancialsolutions...ons/QROPS.html
http://www.spainbusinessbroker.co.uk...fers_faqs.html
http://www.999today.com/moneyandfina...ory/34662.html
http://candourconsultancy.com/QROPS.htm
Daniel
Here goes...
Because Switzerland has a Double Taxation Agreement with the UK containing information and non discrimination provisions, a Swiss pension scheme automatically qualifies as a “Recognised Overseas Pension Scheme”. i.e the Scheme does not have to convince HRMC that it is a acceptable pensions vehicle.
List of countries: http://www.hmrc.gov.uk/manuals/rpsmm...sm14101046.htm
Therefore only the “Q” part QROPS need be satisfied. In effect this only requires notification to HMRC and an undertaking to provide certain information on making payments in respect of certain scheme members.
QROPS requirements. http://www.hmrc.gov.uk/manuals/rpsmm...sm14101050.htm
However the member payment [information] provisions do not apply unless the member:
• is resident in the UK when the payment is made (or treated as made), or
• although not resident in the UK at that time, has been resident in the UK earlier in the tax year in which the payment is made (or treated as made) or in any of the five tax years immediately preceding that tax year.
Therefore, in summary, the obligations of a Swiss scheme in respect of such a member are limited to notification to HMRC of the fact it should be a QROPS and, if it ceases to be a Pension Scheme under Swiss law [!], of that fact.
Wish me luck, I'll let you know how I get on.
Daniel
My first post and am happy to make your acquaintance.
Daniel - I would be very interested in hearing how your "pitch" went. I am trying to do exactly the same thing at the moment.
This whole subject feels like a quagmire of misinformation so any further updates is greatly appreciated.
I understand the whole QROPS thing and as I have been a non resident for more than 5 years it sounds good.
Problem however that I was presented with this week was that the QROPS fund here in Switzerland (my company 2nd pilier) says there is a limit of 20% of my salary that can be transferred at one time each year. I am trying to get toget more information on this one.
Thanks Jamie
The transfer from the UK is a transfer of existing benefits, I dont think you get tax deductions and there should be no limit.
My impression so far is that "normal" Swiss schemes ie not run by international companies for their own employees dont have a effing clue.
Daniel
Daniel
We are currently trying to the same thing for my wife's pension - I could transfer mine as my company is on the QROPs list but we are a bit reluctant to do so. There are a couple of people trying to help us locate someone to help (UBS bank manager and an insurance contact in Basel) but noone is having much luck. Baloise Assurance said pas possible as did Zurich.
I think our last hope would be the Fondation Pictet in Geneva who are listed on the QROPs list (2 pillar vested benefits account) and I am awaiting a reponse from them.
I spoke with the OFAS (Federal Office for Social Insurance) this morning and they confirmed that the 5 year/20% maximum rule applies to transfers also. Here is a link to a document in French that contains this rule along with many others (OPP2 - Article 60B - http://www.admin.ch/ch/f/rs/c831_441_1.html ). The same exists in German and Italian if that suits better.
If you have been here for more than 5 years then you should be ok or there might be more chance. I still have 3.5 years to go.
In terms of a QROPs transfer then directly into Switzerland there appears to be no option before 5 years if you want to do it at one fell swoop.
I am going to look into the option in one of your previous posts, passing via Guernsey. It looked as though it was possible to get your hands on the funds if you had been a non resident of the UK for more than 5 years but transferring to the QROPs fund they had and then cashing it out. That way you could either do the 20% buy back each year and get the tax deduction or use it in which ever way you wanted.
Jamie
I suspect that unless you have a large transfer to make, the guernsey route might be quite expensive.
Daniel
It is attached below. Sorry its too depressing to translated into english...
Via a mutual friend I track down the director of the pension fund of a large Swiss international group whose fund appears in the QROPS list. This very helpful person not only knows all about the Swiss end, but sits on the federal BVG commission and knows people who know at Swisscanto.
She explains that the BVG commission is well aware there is a massive drafting hole in the Swiss legislation as regards transfers inwards, but it is well accepted that it is OK for schemes to set up their rules to allow such transfers-in so long as they do not result in a second tax deduction but do count the transfer towards the total contributions limit. The fact I wont get a double dip on the deductability means I am now "off" the whole idea anyway.
Her contact at Swisscanto confirms this but explains that due to lack of demand Swisscanto has decided not to subject itself to QROPS reporting requirements or make the necessary modification to the rules of their collective funds. I can live with this response because it seems entirely plausible unlike the previous one where I was being treated like a fool.
So there you go.
Daniel
Im also a financial adviser and work both with independant foundations in Switzerland as well as QROPS providers in Guernsey and Singapore ( dont scoff, its the leading wealth management centre, after Geneva :-) ).
Fascinating discussion; I learnt a few things and also have tuppence to throw in the pot. Actually this is about as exciting as pensions get !
As far as i can see anyone would want to transfer out of the UK system if they expected to be an expat in retirement. You had their generous tax treatment .. why would you hang around for the disadvantages ? [ie taxed funds, pension taxed as unearned income, inheritance tax for larger funds, and the requirement to eventually buy a very poor value annuity].
Its true that QROPS providers are currently only geared up for larger transfers but the benefits are incredible. Basically strike out the nasty list aove and add in the fact that you can invest in residential property. In fact the only reason you wouldnt do it is if the transfer value offered by an ex employer wasnt a fair value of the preserved benefits. This calculation can be done on the back of a fag packet, or perhaps better, by a G60 qualified adviser.
By the way if a UK scheme adminstrator makes a transfer to a non-QROPS, this is a chargeable event.
And the relevance for those of us living in Switzerland given that a double dip on the tax relief is limted to 20% for 5 yrs ? Well for most people its the fact that they can use their 2nd pillar scheme to help with property purchase.
Well if you dont qualify to cash out the QROPS, the QROPS can also invest in property, provided its in the right jurisdiction. Moreover a QROPS can both borrow funds, and legally, is a form of trust.
Double bingo then, because as of last year Switzerland recognises trusts, which means that with a little planning you get get rid of your Swiss inheritance tax problem at the same time .
You have obviously put a lot of effort into your research.
Personally I find this whole pension business a confusing headache.
We will be moving permanently to CH early 2009.
I have a UK pension with Zurich and waiting for their advice on the best option, however I am not sure that what I will recieve, will be the best advice.
From what I can see from the other posts to this thread, those that have posted were already resident in CH before they considered their options.
Is it possible to transfer before our move as I would like to use it against the purchase of a property if possible and we are in the process of house hunting.
Stuart
I think not a chance.
It seems to be hard enough if not impossible to transfer if you are already resident unless you happen to have an employer who has a QROPS scheme.
@Phillip
As far as I can work out there is no scope to double dip.
Daniel
From the UK side you can absolutely transfer to a QROPS in advance of quitting the UK.
Just not to Switerland .. for all the reasons discussed, so it would have to be in an independent one, outside Switzerland.
If you have enough cash, between the scheme and personal funds to buy the property then that that is a solution.
The problem comes if you want a mortgage. a hight st bank here wouldn't touch such a creative deal.
Phillip
I've read this thread with interest...totally lost.... but interested, and I am amazed by the tech' knowledge of some of you guy's.
My wife works for J&J, and recently recieved paperwork from J&J asking if she wanted to transfer any UK Pension funds to her J&J CH scheme, so I'm presuming that it's possible. Very broad question I know, but for someone mid forties, looking to stay in CH long term, with funds in a inactive PP in the UK, is transfering to the CH J&J scheme areasonable option.
Any SIMPLE advice greatly appreciated.