OECD Forum Speaker Says Retirement Savers Need Empowerment
On 20 May 2019, the Organisation for Economic Co-operation and Development (OECD) Forum 2019 in Paris heard from Aegon CEO Alex Wynaendts during a panel discussion*, in which he said that rising longevity "should be a gift and not a worry".
However, he noted, preparing for this gift presents a challenge which needs to be addressed not only by the individual but as a joint action with employers and governments as well.
SIPPs Suitability a Key Question for Expats in Spain
A SIPP transfer may offer many benefits, including greater investment flexibility and exemption from capital gains and income tax; however, a SIPP is not suitable for every retirement investor and independent expat financial planning advice should always be sought before committing to a SIPP pension transfer.
Unfortunately, there are some Spain wealth management clients who can testify to the consequences of not seeking suitable independent SIPPs advice; the firm Pension Claim Consulting recently announced that it had taken on 141 claims from expats who believe they have been mis-sold a SIPP pension in the last year.
"We are handling more claims from worried expats than ever before," commented a spokesperson with the firm*.
Court of Appeal’s Expat Tax Ruling
Expat financial planning clients should be aware that HM Revenue & Customs have increased powers to ensure full disclosure of financial information in order to assess tax liability.
This follows a ruling by the Court of Appeal in London* in which the Court upheld the right of HMRC to demand compliance from a UK-connected individual living in Dubai.
The case clearly indicates that UK-interested parties with cross-border financial interests must consider their UK tax liabilities as part of their wider expat financial plans.
Reclaiming the QROPS Transfer Charge – Clarification of Regulations
HM Revenue & Customs has introduced new regulations to make it easier to reclaim the QROPS overseas pension transfer charge. The rules came into effect on April 25, 2019 following a decision by the House of Commons on April 3, 2019.
The Pension Schemes (Information Requirements – Repayment of Overseas Transfer Charge) Regulations 2019* outline the necessary procedures for recovering the charge in cases where it has been incorrectly levied or a change in the member's situation means that the charge is no longer applicable and a retroactive exemption can be applied.
SIPP Providers – Getting it Right
Money Marketing, a UK newspaper for financial intermediaries, has published details of a Freedom of Information Request it made it in relation to complaints received by the Financial Ombudsman Service (FOS) regarding Self Invested Personal Pension (SIPP) products.
It revealed that over the most recent 12-month period, 22 SIPP providers made 48 complaint referrals to the Ombudsman regarding investments.*
This latest revelation follows a SIPP dispute involving financial planner Berkeley Burke and the FOS in which it was heard that the firm failed to carry out full due diligence on a £29,000 unregulated collective investment scheme for one of its clients. It also follows a high profile but as yet unresolved case against Carey Pensions.
Your Expat Pension and Exceeding the Lifetime Allowance
The pensions tax relief Lifetime Allowance (LTA), otherwise known as the pension lifetime limit, should be an area of active concern for any expat with a high-value pension.
Despite this, far too many wealth management clients have insufficient knowledge of precisely what the pension lifetime limit is and they could be affected. In fact, significant numbers of expats may be unwittingly breaching the LTA pension limit, oblivious to the possible consequences.
Abandoning the ‘Lottery Mentality’
Nearly everyone dreams of winning the lottery and sailing into their sunset years of retirement aboard a superyacht of financial freedom and security. The problem is, however, that simply buying a lottery ticket is very unlikely to result in anything other than the needless spending of your hard-earned money.
In fact, when you buy a Euromillions ticket your chances of winning the jackpot are just 1 in 139,838,160* – you are almost certainly more likely to be struck by lightning or involved in a road accident while on the way to buy your lottery ticket than of winning the jackpot.