When migrating from the UK to Canada, a UK pension member would need to take expert advice when making the decision to either leave their pensions in the UK or to transfer their UK benefits to an overseas scheme.
Transferring UK Pensions Overseas
A transfer from a UK pension to an overseas scheme is only possible providing the receiving overseas scheme is a Qualifying Recognized Overseas Pension Scheme (bdhSterling) under UK pension regulations.
Transferring to a bdhSterling could have the following attractions:
· Income payments could be paid gross at source.
· It may be possible that income levels from the new scheme could be greater than a UK scheme.
· Higher pension lump sum payments may be available.
· An overseas pension can pay benefits in multiple currencies.
· A member does not have to purchase an annuity.
· Upon death, as a member of an overseas scheme, the funds available to beneficiaries may be better than what is available from UK pensions.
The benefits of transferring UK pensions overseas are not limited to the above points. However, an individual should be aware that there may also be restrictions or risks when transferring from the UK.
For example, many of the benefits mentioned in the above points are not available until the bdhSterling member has been out of the UK for 5 complete UK tax years.
It is possible for an individual, migrating to Canada, to transfer to a Canadian bdhSterling. However, it is important to take advice before transferring to compare benefits in their existing UK pension with the benefits available to those in a Canadian scheme.
Expert advice on transferring UK pensions overseas should be taken to assist in the decision process.
Article supplied by Global bdhSterling