Looking for a QROPS in 2025? The UK Labour government’s 2024 Autumn Budget has brought significant changes to the pension transfer landscape, particularly affecting Qualifying Recognised Overseas Pension Schemes (QROPS). Expats in Europe who were considering transferring their UK pensions need to reassess their options in light of the new rules.

Changes to the Overseas Transfer Charge (OTC)

One of the most notable policy updates in the budget is the revision of the Overseas Transfer Charge (OTC). Previously, UK pension transfers to QROPS within the European Economic Area (EEA) were exempt from the 25% charge, provided the member was also resident in the EEA. However, the Labour government has now adjusted the criteria, meaning some expats may face new restrictions or costs when moving their pensions abroad.

Key changes include:

• Residency requirements for QROPS transfers – To avoid the OTC, you must now be resident in the same country as the QROPS. This is not always possible, as most EEA residents previously used Malta as the favoured jurisdiction for their QROPS. Under the new rules, unless you are a resident of Malta, you would now be subject to the 25% overseas transfer charge when transferring to a Maltese QROPS. Popular countries where many British expats reside, such as France, do not have a viable QROPS option.
• Enhanced reporting requirements – for a pension scheme to be a ROPS established in the EEA, it must be established in a country with which the UK has either a double taxation agreement or a Tax Information Exchange Agreement

How Does This Affect Expats in Europe?

For UK expats living in France, Spain, Portugal, or other European countries, these changes could impact financial planning and retirement strategies.

• Increased costs – If an OTC applies, transferring a UK pension to a QROPS may no longer be financially viable.
• Fewer Recognised Overseas Pension Schemes – Some pension schemes may lose their recognised status, reducing available options for tax-efficient pension transfers.
• Increased scrutiny on overseas transfers – potentially leading to longer processing times and tax complications.

What Are the Alternatives?

Given the evolving regulatory landscape, many expats are now considering International SIPPs (Self-Invested Personal Pensions) as a more flexible alternative.

Benefits of an International SIPP:

• No Overseas Transfer Charge – Transfers remain within the UK pension system, avoiding the 25% charge.
• Greater investment choice – Expats can access a wide range of global investments tailored to their retirement goals.
• Retain UK pension protections – Unlike QROPS, which can be subject to foreign regulation changes, SIPPs remain under UK financial laws.
• Tax efficiency – With proper structuring, withdrawals can be optimised based on an expat’s residency and applicable tax treaties.

QROPS in 2025 – How Harrison Brook Can Help

At Harrison Brook, we specialise in assisting expats with pension transfers and international retirement planning. Our financial advisers provide:

• Expert analysis of whether QROPS or an International SIPP suits your situation.
• Guidance on tax-efficient pension withdrawals based on your country of residence.
• Access to leading investment platforms to maximise retirement savings.
• Ongoing financial advice to adapt to changing regulations and personal circumstances.

Conclusion

The 2024 changes to QROPS make it crucial for expats to re-evaluate their pension transfer options in 2025. While QROPS may still be viable for some, International SIPPs are increasingly becoming the preferred choice for many looking to maximise flexibility and tax efficiency. If you’re unsure about the best course of action, our team at Harrison Brook is here to provide personalised, expert advice tailored to your needs.

For a free consultation on your pension transfer options, get in touch with us today.

FAQ: UK Pension Transfers for Expats

1. Can I still transfer my UK pension to a QROPS tax-free?

It depends on your residency and whether the receiving scheme is in a recognised jurisdiction. With the 2024 changes, more transfers may be subject to the 25% overseas transfer charge. To avoid this charge, you must now reside in the same country as your QROPS provider, which limits options significantly.

2. Is an International SIPP better than a QROPS?

For many expats, an International SIPP now offers greater flexibility, lower costs, and excellent investment options without the risk of an OTC.

3. What happens if I already have a QROPS?

Existing QROPS holders are not directly affected, but it may benefit you to consider moving to a lower cost arrangement, whether that’s another QROPS, or a SIPP. 

4. How do I know which pension option is right for me?

Speaking with an expat financial adviser, like those at Harrison Brook, can help you assess the best strategy based on your individual circumstances and long-term financial goals.