Pension Flexibility Update

Published: 07 May 2015

There has been much comment on pension flexibility recently, and in particular how this applies to QROPS.

We’d like to take this opportunity to confirm Momentum’s position on this as follows:

UK SIPP: Pension flexibility is available through our UK SIPP. We would remind advisers that tax will be deducted via PAYE on all payments over and above the 25% tax free amount. This means that unless your client has a UK tax code for 2015/16, we will apply emergency tax rates of up to 45%.

To apply for a UK tax code you will need to complete form R43, available here.

A link to the UK Government site for tax for expatriates is available here.

QROPS: At present only QROPS in EU jurisdictions will be able to access pension flexibility and maintain their QROPS status.

Malta has enacted legislation to enable this, however this will not be fully available until all Malta pension schemes are registered under the new Retirement Pensions Act.

We anticipate implementation of this by the end of 2015 at the latest. In the meantime Momentum will pay benefits as before, i.e. up to 30% as a pension commencement lump sum with the balance as an income for life. For the sake of prudence, whilst HMRC reviews are still ongoing, we believe this is the correct stance. We are monitoring this situation and will update all Advisers immediately on receipt of any updates.

QROPS from both the Isle of Man and Gibraltar remain unchanged (i.e. 30% PCLS and an income for life) until further notice.

By way of reminder, Momentum has offerings in all key jurisdictions, and allows free switching between our Schemes.


Switcher Offer

Due to the success of our free switcher schemes for QROPS and SIPP, we are pleased to announce an extension on both offers. By way of reminder, these are the features of both schemes:

  • Zero set-up fee
  • Zero administration charges or fees in the first twelve months
  • An immediate ability to transfer into any other Momentum scheme, free of charge.

The offer for both schemes will run up to the end of July 2015.


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