What is a QROPS?
QROPS stands for Qualifying Recognised Overseas Pension Scheme. It is a designation by Her Majesty’s Revenue and Customs (HMRC) of a Recognised Overseas Pension Scheme or ROPS (itself a UK Treasury designation) that will accept transfers from UK pension schemes without those transfers being considered a benefit crystallisation event (just a complicated bit of jargon that means that it’s a transfer that leads to the scheme member taking a benefit which might be liable to tax).
Simply, this means that people who have a UK pension but that no longer live in the UK can transfer their UK pensions to any scheme that’s a QROPS and they can do so free of any tax liability on transfer. Importantly, this means that they don’t have to transfer to a scheme in the country in which they happen to be living, but can choose a jurisdiction with pension and pension tax rules which could be more beneficial to them.