It’s definitely worthwhile to investigate the advantages of a Qualifying Recognized Overseas Pension Scheme (QROPS) pension transfer. However, to complete a QROPS pension transfer, you must navigate many bureaucratic processes, and this is a job you should not undertake without expert help.
Let’s take a look at the possible pain points you could encounter as you request a QROPS pension transfer:
- You must ensure that your UK pension qualifies for a QROPS in Canada. Some UK pensions, like UK state pensions and some civil service or public sector pensions, cannot be transferred to a QROPS.
- You’ll need to locate QROPS-eligible Registered Retirement Savings Plans (RRSPs) in Canada that you can transfer your UK pension funds to.
- You’ll have to fill out the correct QROPS pension transfer forms. While these forms are available from the Her Majesty’s Revenue and Customs (HMRC) website and from the UK pension provider, it is essential the correct forms are completed for an overseas transfer.
- Once you have correctly filed your paperwork, you’ll need to follow up with UK pension scheme administrators to ensure they have handled your QROPS transfer correctly and efficiently. Because there are several parties involved behind the scenes, this process can become time consuming and tedious, especially dealing with a UK pension provider with an up to 8 hour time difference.
- You’ll also have to complete requests with the Canadian financial institutions that handle the RRSPs that you are transferring funds into. During this process, you’ll have to choose appropriate investment funds within RRSPs. In Canada it is a requirement to use a Canadian financial advisor to set up any RRSP for receipt of the UK pension funds.
- If there are challenges to overcome during the QROPs pension transfer, it’s often difficult to know whom to contact. You may need to consult with HMRC representatives, Canada Revenue Agency (CRA) agents, pension officials, and tax experts, and you may have to facilitate communication between these entities, too.
- If you have multiple qualifying UK pensions, you will have to complete processes to consolidate these pensions into a single Canadian QROPs
Basically, you are navigating a complex procedure entailing two separate countries, and the possible pitfalls can be intimidating.
Fortunately, Sterling Advisory Inc. can help you avoid these pain points. We are QROPS transfer specialists based in Canada, with over 30 years of experience in the financial services industry in both Canada and the UK . Since 2008, we have helped our clients transfer over $140 million of their UK pension funds into Canada.
We understand the intricacies of the QROPS pension transfer process having spent 15 years helping clients transfer their UK pensions into Canada, our experience and expertise allows us to give you the best transfer service available.
If you’d like more information about our QROPs services, or to book a consultation, please contact us. We’re here to help!