CyprusLiving

Has anyone used a Qrops scheme which has enabled them to self manage their investments in stocks and shares as against buying Funds. Cyprus does not seem to have any, and those that I have contacted want investments to be made through them into Bonds as against shares in say FTSE350 etc.

HMRC (UK) removed Cyprus from their list for QROPS earlier last year.

Thanks Rav4man. I have checked the 'Lists' from the UK and think their were 5 in Cyprus. Now no more.
There is a site sponsor, but am still waiting for information.

I live here in Cyprus and have a QROPS, which is placed in Malta. Cyprus was turned down to host a QROPS, which doesn't mean if you live in Cyprus you can't have one. Check out the website www.expas.org it is a free service which will help you with QROPS information and they are based here in Cyprus.

SIPPS offer many of the benefits of QROPS and will allow you to invest in shares. Usiually much cheaper than QROPS too and less chance of being caught up in the ever changing QROPS legislation. Probably 95% of people who have used QROPS would have been better off with a SIPP. In my opinion (and I've been an investment adviser for 25 years) QROPS will become another big Mis-selling scandal. QROPS certainly are right for some people but theyt are currently being sold as a 'onw size fits all' solution.

Just my opinion!!

As has been said, you have access to QROPS or SIPPS in various jurisdictions.
If you are adamant that you want to hold shares rather than funds, there are arrangements which can facilitate this. I would suggest you look carefully at the costs involved as share dealing via a pension arrangement can be more costly & cumbersome than otherwise. Primarily because it is the trustee that owns the assets & therefore they have the responsibility of buying/ selling & do not do this for free!

If you are pre retirement age a SIPP may be your best choice due to the significantly lower costs. If you want specific info aor advice, please get in touch.

All the best

Thanks gazzaga and MarkN. I was also an advisor and have been in a SIPP for many years. I like the SIPP format and low costs but am moving towards QROPS to keep the 55% tax charge at bay.

Bazzra,

it sounds like you have done your research and you know that an event triggering a lifetime allowance test includes transferring your pension pot into a QROPS.

But, depending on your age, have you considered buying an annuity or income drawdown of your existing pension pot before it goes above the LTA?

You might be taking the maximum tax free cash and drawing your pension earlier than you might have planned, but this money could be used to go into some other vehicle for your retirement.

I guess what also comes into play is your current tax status, and at what point you would become a Cypriot resident for tax purposes.

Bazzra wrote:Thanks gazzaga and MarkN. I was also an advisor and have been in a SIPP for many years. I like the SIPP format and low costs but am moving towards QROPS to keep the 55% tax charge at bay.

One thing to remember is that the 55% tax only applies if your beneficiaries decide to take the remaining capital as a lumpsum from your SIPP. If they continue to take an income, there is no tax charge other than income tax as would have been applied prior to your death, based on their tax residency & allowances. In most cases we see, the surviving spouse would continue taking income, thereby avoiding the tax penalty.

this said, if the survivors are likely to want the capital as a lumpsum, then QROPS is clearly the choice. The SIPP providers we use also offer QROPS and a free transfer SIPP to QROP at crystallisation if requested.

All the best

You seem to favour the SIPP unless the beneficiaries want the inheritance as s lump sum, what about benefits to the person getting the pension. Does a SIPP pay 120% of GAD for example?

And would everyone want to self invest and not use a financial advisor like you? I am sure you are not free.

Mark,

You are quite right, in many cases, and certainly for people some years pre-retirement, I favour a SIPP over a QROP. The main reasons bein cost & regulation. In a SIPP costs are typically lower and their regulation is clearly defined; typically QROPs are significantly more expensive & there is a degree of uncertainty over their regulation.
Bearing in mind that QROPs follow the UK regulations - SIPPS do allow up to 120% GAD (this had been reduced but was raised as of April).

I'm not syre of your final point - you are right, I am certainly not free! People are free to 'self invest' via a number of investment vehicles or take advice on those investments. I'm sure there will be people who prefer each method - the choice is theirs.

All the best

Mark Jester wrote:You seem to favour the SIPP unless the beneficiaries want the inheritance as s lump sum, what about benefits to the person getting the pension. Does a SIPP pay 120% of GAD for example?

And would everyone want to self invest and not use a financial advisor like you? I am sure you are not free.