WILL BRITISH EXPATS PENSION RIGHTS BE SAFEGUARDED?

Spanish Prime Minister Mariano Rajoy has said that he thinks a deal can quickly be worked out with Britain to defend the rights of British expats in Spain after Brexit.

“I am absolutely convinced that we will reach an agreement so that these people will not be affected by political decisions,” Rajoy said in an interview with the AFP news agency.

However the question for many expats looking to take advantage of the ability to transfer their pension savings under the QROPS rules is;

Will their right to transfer be maintained once the UK LEAVES the EU?

There are two potential scenarios

1. That the freedom of movement of pensions within the EEA is upheld as a concession to having freedom of moment of goods and services and being part of the single market.

2. That leaving the EU may give HMRC the opportunity to expand the pension transfer tax of 25% that has been put onto non EEA residents to apply to EEA residents also. That will leave transfers only possible to the country in which the member resides.

Freedom to provide services throughout Europe will also be an important factor within the financial adviser community as currently they can passport throughout Europe and advise residents of other countries on QROPS.

When the formal application to leave the EU is made and the negotiations start, freedom of movement of labour, capital, services and pensions will certainly be at the heart of these negotiations.

It may be that during this period, given that the ability to transfer is guaranteed within Europe, that anyone who has already left, or is considering leaving the UK at any time in their life will take advantage of the current rules just in case they are removed