QROPS HMRC rules do not fill investors full of confidence when the government can’t get it right in its handling of the listed registrar of schemes. It appears that many schemes that register as a QROPS go through a process of ‘self-certification’ as opposed to being vetted by HMRC before inclusion on the list. This clearly is not satisfactory, especially if policyholders are being exposed to the risk of high penalty charges should HMRC decide to retroactively change the status of an existing scheme.
Such was the case with the ROSIIP QROPS based in Singapore, wherein HMRC was challenged successfully in the High Court by scheme members over its decision that the scheme no longer met the conditions of a qualified recognised overseas pension scheme. The delisting of the ROSIIP QROPS from the registrar in 2008 meant that 122 UK pension holders who had transferred their pensions to the Singaporean scheme faced a possible 55 percent tax charge on their savings for making an unauthorised transfer.
QROPS HMRC rules do not fill investors full of confidence when the government can’t get it right in its handling of the listed registrar of schemes. It appears that many schemes that register as a QROPS go through a process of ‘self-certification’ as opposed to being vetted by HMRC before inclusion on the list. This clearly is not satisfactory, especially if policyholders are being exposed to the risk of high penalty charges should HMRC decide to retroactively change the status of an existing scheme.
The end result is that HMRC has ended up with egg on their face. The administration of the QROPS regime has at times fallen below the required standard. In July 2013 several hundred schemes were mistakenly omitted from the list because of a technical glitch. HMRC later apologised for this error. The case highlights the need for more consistency regarding the list.
For further information please download our free QROPS Guide