We are unique in focusing on issues related to change management of international business and wealth migration and have researched solutions to meet the needs of foreign nationals clients looking to live or acquire assets in the United Kingdom, buy property in England and Wales or cross-border property, pensions and annuities transactions into the United Kingdom (even in the wake of the Brexit vote, London remains a leading global city and so it continues to attract investment from individuals and companies from around the world). Reasons for undertaking such action may include:
- HNWI considering their future planning needs
- Property clients; for development or investment
- International companies looking at inward investment
If you wish to protect property assets, preserve wealth and plan for future generations, then we can guide you and engage professionals who provide specialist high quality advice and solutions or introduce you to a range of dedicated professionals who specifically focus on regulated solutions. Their solutions focus on growing your property or investment assets, protecting their value and allowing for the transfer of such assets between generations. This can only be achieved by having a clear understanding of our client's current holdings following a detailed assessment. There is no ''one size fits all'' approach. We consider each client's concerns and objectives and conduct bespoke analysis.
We fully understand that clients have long standing relationships with their own adviers, Trustees and legal teams and we seek to ensure that these collaborative relationships are enhanced when introducing solutions. We are happy to work with any team in place to the mutual benefit of the client. We work with them, not against them. Please contact us for an informal discussion about your future plans, without obligation.
Our clients tend to share similar concerns over their wealth generation and the protection of it for the future. They may also have the following priorities or exposures:
- They are looking to simplify their various portfolios
- They have complex, out of date ownership structures
- They may become deemed domicile to the UK shortly and wish to protect their worldwide wealth
- They have issues with remittance of capital into the UK for the short / medium term objectives to live here before moving away
- They wish to look closely at asset protection and legacy planning, or "firewalling" that wealth from certain pressures or future disputes
We believe that International Pension Plans may be appropriate for pension planning where clients in many categories (United Kingdom Domiciles, United Kingdom Non-Domiciles, Foreign Nationals and Non United Kingdom Resident Domiciles) may wish to hold United Kingdom property.
International Pension Planning can be focused on United Kingdom property assets, protecting their value and allowing for the transfer of such assets between generations.
Disclaimer : geodesiq, as a facilitator of introductions, refers clients in respect of investments, pensions and insurance matters to service providers and advisors which may in turn carry out advisory and implementation work for clients and is not responsible for arranging or advising on any of the financial services products, or services discussed in "International Pension Planning (United Kingdom) as Wealth Migration".
A QNUPS is a Qualifying Pension for United Kingdom tax recognition but it is a "Non United Kingdom Pension Scheme" - hence the acronym QNUPS (Qualifying Non United *Kingdom* Pension Scheme).
A QNUPS is an extremely flexible pension which can be a useful retirement planning tool. It allows clients to save towards retirement during the wealth accumulation phase of their lives.
A QNUPS can hold property, stocks and shares, debentures, carried interests, intellectual property, private equity and patents.
- A QNUPS must be established overseas
- It must be recognised for tax purposes
- It must be registered by the relevant authorities of the country in which it is established, or be established by certain international organisations
Where there is no tax or regulatory authority or the scheme is established by an international organisation, the scheme must provide for:
- At least 70% of the member's scheme funds are to be used to provide an income for life
- Benefits should not be paid until the member has reached the normal minimum pension age applicable in the United Kingdom (currently 55)
- Depending on the QNUPS rules and the flexibility permitted by the overseas tax authorities or regulator, a member may be permitted to take a loan from their pension fund
Yes. For United Kingdom domiciled clients, a QNUPS is available to clients seeking to build up a pension fund without the restriction of a Lifetime Limit .
Very much so. Offshore pensions should be an essential consideration for anyone intending to work abroad, as not all employers will offer a pension scheme as part of their salary benefits. Considering alternative pension plans such as QNUPS is advisable to enjoy an offshore retirement and flexibility of investment choices.
A QNUPS is an ideal investment vehicle for people who are internationally mobile and may wish to move their wealth with them from country to country over time until an eventual retirement location is selected.
It permits overseas investors, who have property in a number of countries, to "pool" their assets in one place, not only benefiting from the administrative advantage of managing assets from one location, but also doing so in a jurisdiction that minimises taxes payable to countries in which they might only spend a relatively short period of time.
A QNUPS is available to United Kingdom and non-United Kingdom residents aged 18 to 75.
A QNUPS can be established in any country with appropriate pensions legislation. A QNUPS need not be established in a country or territory which has a double taxation agreement with the United Kingdom.
A QNUPS tends to be in an individual name but it can hold property jointly. A family or "multi-member" QNUPS is possible but this will depend on the jurisdiction in which it is established. A Corporate or Group QNUPS can also be established.
No. If he / she is considering his / her options on whether to do so, a QNUPS may be appropriate vehicle to pool assets and remain flexible on his / her eventual retirement location, including the United Kingdom.
Yes. A client can name the QNUPS anything he / she may wish. There is no duty of the trustees to report or disclose the beneficiaries of the QNUPS to any other jurisdiction.
Yes. Multi-currency holdings of assets and cash is permitted.
- Income tax on net rents limited to 20% (for United Kingdom property)
- No Inheritance Tax on contributions or on death
- No Capital Gains Tax on assets
- Stamp Duty Land Tax is Minimal Possible Rate (for United Kingdom property)
- No Annual Tax on Enveloped Dwellings (for United Kingdom property)
For property, a QNUPS is liable to 20% United Kingdom Income Tax on net rental income (after deductions).
The annuity is subject to income tax at the client's marginal rate in the jurisdiction in which the client resides at the time of retirement. In certain circumstances it is entirely possible that the QNUPS can acquire an Annuity Certain - whereby the tax treatment of the income is that the interest element is chargeable to tax but the capital element is not as it is deemed to be return of capital.
Once established, a QNUPS can receive contributions, accept transfers and make investments in a wide variety of ways to provide for future retirement benefits and family wealth preservation requirements. The Member contacts the Pension Trustee (PT) and gives the relevant instructions upon which the PT acts. The PT has no discretion in executing such instruction other than to maintain the commerciality of the transaction. There is no discretion exercised by the PT or contingency in terms of the execution of the transaction.
There is no limit to the size of the contributions. Contributions can be made until the age of 75.
As well as classic financial investments a QNUPS offers a wider range of acceptable investments, including property (residential and commercial) and loans. Alternative financial instruments including carries, options, warrants, intellectual property, patents and physical assets such as works of art, precious metals and gemstones can also be held. Collectables are also a possibility.
Yes. Transfer into the QNUPS may be done with mortgages, subject to lender agreement. The client will pay Stamp Duty Land Tax on the loan value. It is more tax efficient to transfer the assets in unencumbered, by discharging the mortgage prior to transfer, or using alternative finance.
There is a common misunderstanding that a QNUPS cannot hold a client's primary residence. It can. But, it does depend on the jurisdiction of the QNUPS. Individual circumstances will need to be considered when looking at transferring a primary residence into a QNUPS.
If an asset is contributed to a QNUPS by a member, the maximum access to that capital value, via the loan back facility, is limited to 30% of the value of the fund.
If, however, the asset is sold to the QNUPS by the member, on deferred payment terms, the member can access up to 100% of the capital value if desired.
When assets in the funds are sold, the member can then call for the deferred payment(s) - easily accessing cash very quickly.
The most popular method of deferred payment is an annuity, making an annual payment to the member, and being capable of being redeemed or 'encashed' by the member as and when the QNUPS has the funds to do so.
There should not be a problem investing in overseas assets but care will need to be taken over the regulations where the asset is and ensuring the country in which the client is investing recognises the same tax relief on Pension Schemes as in the EU.
Yes.
Any investments are theoretically eligible but like any investment, the Trustees will have to exercise sound commercial judgement in evaluating the risk versus return before deciding to invest.
QNUPS can obtain mortgages in common with all United Kingdom pensions.
This depends on how the QNUPS is structured and what it holds. However, money within QNUPS is not inextricably committed to the pension scheme until 78. It is possible to have up to 30% of funds from from the pension in a client's lifetime as a loan back. There is no restriction on what these funds can be used for.
Yes. He can manage the portfolio in his QNUPS on a daily basis.
The QNUPS can contract with the management company to continue the existing management of the portfolio. The net rentals will be paid by the management company into the QNUPS.
The net cash proceeds are held in the QNUPS. There will be no CGT payable on any gains made on the property.
Up to 30% of the asset value, payable tax free, by way of a loan on commercial terms. If the client sold assets to the scheme in exchange for an annuity, he has flexible access up to 100%.
The earliest a client may take retirement benefits from the plan is at age 55. The client can make contributions into the QNUPS until age 75.
The QNUPS will have been set up so that when the member dies he may leave it and all the investments, by a letter of wishes, to his prospective beneficiaries. This is outside the scope of United Kingdom inheritance tax.
Yes, and the client may choose to set up a family QNUPS or individual QNUPS for potential beneficiaries. This depends on personal circumstances and requirements. Proper professional advice is required.
- HNWI considering their future planning needs
- Property clients; for development or investment
- International companies looking at inward investment
If you wish to protect property assets, preserve wealth and plan for future generations, then we can guide you and engage professionals who provide specialist high quality advice and solutions or introduce you to a range of dedicated professionals who specifically focus on regulated solutions. Their solutions focus on growing your property or investment assets, protecting their value and allowing for the transfer of such assets between generations. This can only be achieved by having a clear understanding of our client's current holdings following a detailed assessment. There is no ''one size fits all'' approach. We consider each client's concerns and objectives and conduct bespoke analysis.
We fully understand that clients have long standing relationships with their own adviers, Trustees and legal teams and we seek to ensure that these collaborative relationships are enhanced when introducing solutions. We are happy to work with any team in place to the mutual benefit of the client. We work with them, not against them. Please contact us for an informal discussion about your future plans, without obligation.
Our clients tend to share similar concerns over their wealth generation and the protection of it for the future. They may also have the following priorities or exposures:
- They are looking to simplify their various portfolios
- They have complex, out of date ownership structures
- They may become deemed domicile to the UK shortly and wish to protect their worldwide wealth
- They have issues with remittance of capital into the UK for the short / medium term objectives to live here before moving away
- They wish to look closely at asset protection and legacy planning, or "firewalling" that wealth from certain pressures or future disputes
We believe that International Pension Plans may be appropriate for pension planning where clients in many categories (United Kingdom Domiciles, United Kingdom Non-Domiciles, Foreign Nationals and Non United Kingdom Resident Domiciles) may wish to hold United Kingdom property.
International Pension Planning can be focused on United Kingdom property assets, protecting their value and allowing for the transfer of such assets between generations.
Disclaimer : geodesiq, as a facilitator of introductions, refers clients in respect of investments, pensions and insurance matters to service providers and advisors which may in turn carry out advisory and implementation work for clients and is not responsible for arranging or advising on any of the financial services products, or services discussed in "International Pension Planning (United Kingdom) as Wealth Migration".
What is a QNUPS?
A QNUPS is a Qualifying Pension for United Kingdom tax recognition but it is a "Non United Kingdom Pension Scheme" - hence the acronym QNUPS (Qualifying Non United *Kingdom* Pension Scheme).
A QNUPS is an extremely flexible pension which can be a useful retirement planning tool. It allows clients to save towards retirement during the wealth accumulation phase of their lives.
A QNUPS can hold property, stocks and shares, debentures, carried interests, intellectual property, private equity and patents.
What are the main characteristics of a QNUPS?
- A QNUPS must be established overseas
- It must be recognised for tax purposes
- It must be registered by the relevant authorities of the country in which it is established, or be established by certain international organisations
Where there is no tax or regulatory authority or the scheme is established by an international organisation, the scheme must provide for:
- At least 70% of the member's scheme funds are to be used to provide an income for life
- Benefits should not be paid until the member has reached the normal minimum pension age applicable in the United Kingdom (currently 55)
- Depending on the QNUPS rules and the flexibility permitted by the overseas tax authorities or regulator, a member may be permitted to take a loan from their pension fund
Is a QNUPS suitable for United Kingdom domiciled clients?
Yes. For United Kingdom domiciled clients, a QNUPS is available to clients seeking to build up a pension fund without the restriction of a Lifetime Limit .
Are QNUPS suitable for United Kingdom domiciles who live overseas as "expats"?
Very much so. Offshore pensions should be an essential consideration for anyone intending to work abroad, as not all employers will offer a pension scheme as part of their salary benefits. Considering alternative pension plans such as QNUPS is advisable to enjoy an offshore retirement and flexibility of investment choices.
What about international clients?
A QNUPS is an ideal investment vehicle for people who are internationally mobile and may wish to move their wealth with them from country to country over time until an eventual retirement location is selected.
It permits overseas investors, who have property in a number of countries, to "pool" their assets in one place, not only benefiting from the administrative advantage of managing assets from one location, but also doing so in a jurisdiction that minimises taxes payable to countries in which they might only spend a relatively short period of time.
At what age can a client set up a QNUPS?
A QNUPS is available to United Kingdom and non-United Kingdom residents aged 18 to 75.
Where can a QNUPS be established?
A QNUPS can be established in any country with appropriate pensions legislation. A QNUPS need not be established in a country or territory which has a double taxation agreement with the United Kingdom.
Does the pension have to be in a sole client's name only, or can it be in joint names?
A QNUPS tends to be in an individual name but it can hold property jointly. A family or "multi-member" QNUPS is possible but this will depend on the jurisdiction in which it is established. A Corporate or Group QNUPS can also be established.
Does a client have to retire abroad to have use of a QNUPS?
No. If he / she is considering his / her options on whether to do so, a QNUPS may be appropriate vehicle to pool assets and remain flexible on his / her eventual retirement location, including the United Kingdom.
Can a QNUPS be set up to retain anonymity of ownership of the client's assets?
Yes. A client can name the QNUPS anything he / she may wish. There is no duty of the trustees to report or disclose the beneficiaries of the QNUPS to any other jurisdiction.
Can a client contribute and hold investments in other currencies?
Yes. Multi-currency holdings of assets and cash is permitted.
QNUPS and United Kingdom Tax?
- Income tax on net rents limited to 20% (for United Kingdom property)
- No Inheritance Tax on contributions or on death
- No Capital Gains Tax on assets
- Stamp Duty Land Tax is Minimal Possible Rate (for United Kingdom property)
- No Annual Tax on Enveloped Dwellings (for United Kingdom property)
QNUPS and United Kingdom Income Tax?
For property, a QNUPS is liable to 20% United Kingdom Income Tax on net rental income (after deductions).
When can a client take an income from a QNUPS and is the annuity paid to the client subject to any Income Tax?
The annuity is subject to income tax at the client's marginal rate in the jurisdiction in which the client resides at the time of retirement. In certain circumstances it is entirely possible that the QNUPS can acquire an Annuity Certain - whereby the tax treatment of the income is that the interest element is chargeable to tax but the capital element is not as it is deemed to be return of capital.
What is the QNUPS Process?
Once established, a QNUPS can receive contributions, accept transfers and make investments in a wide variety of ways to provide for future retirement benefits and family wealth preservation requirements. The Member contacts the Pension Trustee (PT) and gives the relevant instructions upon which the PT acts. The PT has no discretion in executing such instruction other than to maintain the commerciality of the transaction. There is no discretion exercised by the PT or contingency in terms of the execution of the transaction.
How much can be invested into a QNUPS once it is set up?
There is no limit to the size of the contributions. Contributions can be made until the age of 75.
What can a QNUPS invest in?
As well as classic financial investments a QNUPS offers a wider range of acceptable investments, including property (residential and commercial) and loans. Alternative financial instruments including carries, options, warrants, intellectual property, patents and physical assets such as works of art, precious metals and gemstones can also be held. Collectables are also a possibility.
Can a property portfolio that is heavily geared still be transferred into a QNUPS?
Yes. Transfer into the QNUPS may be done with mortgages, subject to lender agreement. The client will pay Stamp Duty Land Tax on the loan value. It is more tax efficient to transfer the assets in unencumbered, by discharging the mortgage prior to transfer, or using alternative finance.
Can a QNUPS hold a principal primary residence?
There is a common misunderstanding that a QNUPS cannot hold a client's primary residence. It can. But, it does depend on the jurisdiction of the QNUPS. Individual circumstances will need to be considered when looking at transferring a primary residence into a QNUPS.
Why would one sell an asset to a QNUPS rather than contribute it?
If an asset is contributed to a QNUPS by a member, the maximum access to that capital value, via the loan back facility, is limited to 30% of the value of the fund.
If, however, the asset is sold to the QNUPS by the member, on deferred payment terms, the member can access up to 100% of the capital value if desired.
When assets in the funds are sold, the member can then call for the deferred payment(s) - easily accessing cash very quickly.
The most popular method of deferred payment is an annuity, making an annual payment to the member, and being capable of being redeemed or 'encashed' by the member as and when the QNUPS has the funds to do so.
How easy is it to invest QNUPS money in non United Kingdom assets e.g. buy a property in China?
There should not be a problem investing in overseas assets but care will need to be taken over the regulations where the asset is and ensuring the country in which the client is investing recognises the same tax relief on Pension Schemes as in the EU.
A client has a property and assets outside the United Kingdom. Can the client transfer these into QNUPS?
Yes.
If a client or his family members start up a company, does he have the freedom to direct the QNUPS to invest? Does he have to prove to the Trustees that it is a sensible investment?
Any investments are theoretically eligible but like any investment, the Trustees will have to exercise sound commercial judgement in evaluating the risk versus return before deciding to invest.
Is it possible to mortgage QNUPS assets to release capital for further investments?
QNUPS can obtain mortgages in common with all United Kingdom pensions.
Can a client get money out if he needs it?
This depends on how the QNUPS is structured and what it holds. However, money within QNUPS is not inextricably committed to the pension scheme until 78. It is possible to have up to 30% of funds from from the pension in a client's lifetime as a loan back. There is no restriction on what these funds can be used for.
A client managers his own portfolio of stocks and shares. If his QNUPS invests in stocks and shares, can he manage them as well?
Yes. He can manage the portfolio in his QNUPS on a daily basis.
A property portfolio is currently managed by a management company, will this continue if a client transfers or sells the portfolio to a QNUPS?
The QNUPS can contract with the management company to continue the existing management of the portfolio. The net rentals will be paid by the management company into the QNUPS.
What happens if a client wants to sell one of the properties in the QNUPS?
The net cash proceeds are held in the QNUPS. There will be no CGT payable on any gains made on the property.
How much money can a client access from the pension scheme before he retires?
Up to 30% of the asset value, payable tax free, by way of a loan on commercial terms. If the client sold assets to the scheme in exchange for an annuity, he has flexible access up to 100%.
Are there restrictions on when the client can retire?
The earliest a client may take retirement benefits from the plan is at age 55. The client can make contributions into the QNUPS until age 75.
What happens to a QNUPS when the member dies?
The QNUPS will have been set up so that when the member dies he may leave it and all the investments, by a letter of wishes, to his prospective beneficiaries. This is outside the scope of United Kingdom inheritance tax.
Can a person leave a QNUPS to other family members' QNUPS?
Yes, and the client may choose to set up a family QNUPS or individual QNUPS for potential beneficiaries. This depends on personal circumstances and requirements. Proper professional advice is required.