Selecting the right adviser can minimise QROPS risk

Recent events, including the action taken by HMRC against an unregulated QROPS scheme operating in Hong Kong, have focused attention on the risks to internationally mobile individuals seeking to transfer their UK pension funds out of the UK.

In our view, a client who is seeking advice on QROPS will benefit from engaging a fee-based, independent adviser who will undertake the following:

•Assess the suitability of QROPS to each client on a case-by-case basis and in a number of cases, best advice will be to leave the pension fund in the UK.
•Identify which QROPS jurisdiction is most suitable to the client’s circumstances. For example, should they utilise a scheme operated in the EU rather than a Channel Islands based scheme?
•Identify which QROPS provider to recommend. The adviser should demonstrate what due diligence has been undertaken on the provider. For instance, if the provider is privately-owned, who are the shareholders and what is the track record in pension administration?
•Confirm all advice in writing in a ‘QROPS Suitability Report’ which will also confirm the set up and ongoing fees to be incurred. The fees charged should be 100% transparent and the cost of advice should be unbundled and distinct from the QROPS plan charges.
The pension advice process referred to above is standard practice among most UK-based advisers, and would serve to protect the interests of internationally mobile clients and help put a stop to clients taking up unsuitable schemes.

For expert QROPS advice go to http://www.qrops-advisers.com or call 01664 444625

http://www.international-adviser.com/article/selecting-the-right-adviser-can-minimise-qrops-risk