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Transfer Personal Pension to International SIPP

Transfer Personal Pension to International SIPP

Do you hold a UK personal pension? Do you require access to a personal pension in the UK? Perhaps you need to transfer your personal pension to an International SIPP to gain access? Within this article, we discuss transferring your personal pension to an International SIPP. We specifically cover the options available, fees incurred and the process involved.

UK Personal Pension

A UK personal pension is a pension that is arranged by yourself. Also known as Defined Contribution and Money Purchase. Occasionally employers may provide personal pensions in the form of workplace pensions. Usually, contributions are matched by the employer and receive tax relief.

Types of Personal Pension

There are two types of personal pension:

Self Invested Personal Pension (SIPP) – A SIPP allows you to control over the investments within your pension pot

Stakeholder PensionHave to adhere to specific government requirements including limitations on charges

Accessing your Personal Pension

Whether or not you can access your personal pension as a non-UK resident depends on the scheme itself. Old schemes tend not to allow flexible access. Often, although they state you can roll your existing scheme into a flexible access version, this isn’t usually possible.

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Transfer Personal Pension to International SIPP

To transfer your personal pension to an International SIPP you will need to speak to a regulated independent financial adviser. There are various providers available ranging in costs and offerings. For a cost comparison, you can visit my colleague’s article here. Depending on your location, nationality, pension pot value, and overall requirements, different providers hold different benefits.

Benefits of an International SIPP

There are numerous benefits to an International however I have listed some key ones below:

Invest in a large range of assets

Including but not limited to low-cost passive index funds, commercial property, UK and overseas stocks and shares, government securities, endowment policies, mutual funds, and Discretionary fund managers.

Full flexible Access

Gain total control over how and when you take income. Be it regular or ad hoc from age 55.

Ongoing Management

Utilise a regulated independent adviser to implement an ongoing strategy to meet your requirements.

Multi-Currency

Mitigate currency risk by investing and drawing down in all major currencies.

Protection and Safety

Retain the regulation of the Financial Conduct Authority and Financial Services Compensation Scheme.

UK Compliant

As the pension and monies stays in the UK, no changes are required should you return or retire back in the UK.

Low Cost

Far lower in both setup and annual trustee fees than a QROPS.

Consolidation

Consolidate two or more pension schemes and reduce costs whilst allowing greater overall strategy to be implemented.

Risks of Transferring Personal Pension to International SIPP

There are 3 key risks to consider when transferring your personal pension:

  1. Hidden Costs – Is your adviser fee-based or commission based? A full breakdown of the difference including case studies can be found here
  2. Lifetime Allowance Limit (LTA)Current LTA is £1.073m, if you are near this amount or have a sizable value and do not intend to access your pension for a considerable time, there may be more suitable solutions to utilise such as a QROPS.
  3. Investment Risk – As with all investments, the value can go down as well as up. If using a non-advised solution you can be suspectable to large losses which will significantly impact your retirement.

How much does Pension Transfer Cost?

Again, this depends on the adviser and products utilised. You can see a full breakdown of the potential associated costs with a personal pension transfer here.

The next step for a Personal Pension Transfer?

Speak to an independent, impartial, qualified financial advisor and ensure they are regulated in the jurisdiction you reside. They can discuss your requirements in greater detail before assessing your existing position and advise accordingly. There are numerous international SIPP’s and investment products available and it is never a one size fits all solution. Factors such as pension value, age, income or capital growth requirements, where you intend to retire, Inheritance tax planning, and so on, all play a large role in deciding the best solution and fund allocation, for your new International SIPP.

For a quick chat on your current position and the options available, you can contact me directly here.

Want to find out more?

Video FAQ

For more information on this service/blog, please watch our FAQ video below. You can also find more video guides on expat financial planning on our YouTube channel.

The information contained herein is for informational purposes only which is subject to change and should not be relied upon. You should seek advice from a professional adviser before embarking on any financial planning activity.

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