If you are reading this article about how you can receive post- Brexit pension advice then you will be pleased to find out there are multiple regulated solutions available for you. The most surprising one is that, not only can you speak with your current UK pension adviser post-Brexit, provided their Professional Indemnity Insurers allow this, but there are a range of specialists who focus on British pensions. These experts are both in and out of Europe.
So, the first rule?
Ask these questions of your adviser whether they are in the EU or not:
- Does your PI cover specifically cover British pensions advice (for example some in the European Union do NOT cover pensions from other countries)?
- Can I see your certificate of qualification for pensions advice (never do business with an adviser who does not have an authorised certificate in their own name)?
- Does your company hold terms of business with my current pension provider (most EU based advisers will not hold terms, and thus they force you to transfer your pension even when it is not necessary to do so, and often to more expensive pension products such as QROPS or SIPPs)?
See our NOTES section at the end for more comprehensive details on these matters.
FREE OFFER: If you are unsure, contact us and we will do a spot check on your behalf for free of the people who are providing you with advice.
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The second rule of receiving pensions advice
It is not about the pension!
It is about what your goals and ambitions are, along with your attitude to risk, and you need to consider your investments as well as your pensions; this was true pre and Post Brexit.
In other words you need a review, and ideally you should be seeking that review with advisers that are qualified and regulated in both territories (you need the local advice about what is available just like you need the specialist advice from the UK side. The Aisa Group have advisers in both the UK and the EU, qualified to both UK and EU standards. Who better to contact about your UK pensions and investment Post Brexit?
The firms operate under both regulatory setups and they use EU passporting within the EEA.
What is EU passporting?
EU passporting enables financial firms in the EU/EEA to provide services to investors in other EU/EEA countries.
What changed after Brexit?
UK financial firms cannot sell their services into the EU/EEA unless they obtain local licences in an EU/EEA country. Read more on the impact of Brexit on British Pensions here.
Does the Aisa Group have licences within the EU/EEA?
Yes. In fact they have discretionary investment securities licences making them almost unique in being able to offer award winning investment advice alongside the specialist pension advice.
For example, the UK establishment has defined benefit pension advice licences. Try and find another group in the EEA that has discretionary investment licences and the highest mark of pensions advice qualifications.
What about advice on UK pensions for residents in EU/EEA states going forward?
MiFID rules for the EU do not actually cover pensions at all- a myth further exploited by EU based advisers looking for business by moving UK pensions. In fact, given the UK requirement to achieve a professional level standard of qualifications it is far more likely that a UK based firm will be better placed to understand your UK pensions and advise you accordingly.
What is the Overseas Transfer Charge?
The OTC is a 25% charge on transfers from UK registered pensions to QROPS if the investor is not resident in the EU/EEA or not resident where the pension is being transferred to(there are different rules for offshore employer schemes)
Can I still pay into my UK pension if I live abroad?
You may be able to do this for up to 5 years but they would need to be to a pension you were already a member of before moving abroad. The amount will depend if you have relevant UK earnings or, if not, it is capped at £3,600 pa.
What if I access my UK pension and return to the UK, can I still pay into the pension?
You should be very careful about accessing your UK pension if your intention is to return to the UK and contribute in future. You may be restricted by the MPAA to £4,000 pa contributions.
What are QROPS?
QROPS are recognised overseas pension schemes that can accept transfers from UK registered pensions?
Should I transfer to a QROPS if I move abroad?
In the majority of cases, it is unlikely that a QROPS will be a suitable option. However, there may be circumstances where this is considering- depending on Double Tax Treaties, the Lifetime Allowance and the pension rules where you currently reside.
Lifetime Allowance(LTA)- What is it?
There is a limit as to how much you can hold in a UK pension without being taxed on a transfer abroad or when you access the pension.
What is the LTA limit?
It is currently £1,073,100, though there are previous protections that may provide for a larger LTA.
Can I move a QROPS back to a UK pension and is it a good idea?
Yes, and many are doing so where their plans have changed or where the initial transfer to a QROPS was found to be inappropriate.
There appears to be a misconception, particularly among EU based advisers, that UK advisers cannot advise EU residents on their UK/British pensions. It may be due to a lack of understanding or a deliberate attempt to encourage people to transfer their UK pensions to alternative arrangements for the purpose of generating commission for themselves.
The end of EU passporting services into the EU by UK advice firms means that UK advisers cannot market their services within the EU or travel to the EU to offer their services. It does not prevent those with UK pensions contacting their UK advisers in the UK to advise them about their current UK pensions- provided their Professional Indemnity Insurers allow this.
In fact, given the UK requirement to achieve a professional level standard of qualifications it is far more likely that a UK based firm will be better placed to understand your UK pensions and advise you accordingly. Further, the MiFID rules for the EU do not actually cover pensions at all- a myth further exploited by EU based advisers looking for business by moving UK pensions.
That being said, if you have pensions left in the UK- Post Brexit- you really ought to have a review of these, in conjunction with your other pensions and investments. The Aisa Group have advisers in both the UK and the EU, qualified to both UK and EU standards. Who better to contact about your UK pensions Post Brexit?