Resolving Pension Tax Hurdles for Expats

A strategy for optimising QROPS when moving from the UK to France

The situation. Ruth* had benefited from a Guernsey RATS (Retirement Annuity Trust Scheme), which qualified as a QROPS (Qualifying Recognised Overseas Pension Scheme), while living in the UK due to its favourable tax conditions. 

On moving to France she needed to relocate her QROPS to a different jurisdiction to avoid double taxation.

Pension plan. Our strategy to optimise Ruth’s pension comprised:

• Changing to a Maltese QROPS, which has a DTA (Double Taxation Agreement) with France, so she can make drawdowns and only pay tax in France.
• Suggesting alternative investments, such as the French SCPI (Société Civile de Placement Immobilier), which brings regular income and favourable tax treatment.

Key takeaway. Moving a pension pot between two different QROPS, even if it is a different jurisdiction, doesn’t attract any tax so you save a considerable amount at the end. 

*Names have been changed for confidentiality.