QNUPS | Non-UK Pension Schemes

What is a QNUPS?

A QNUPS offers flexibility and the potential for growth.

A Qualifying Non-UK Pension Scheme (QNUPS) is a retirement planning vehicle that offers flexibility and the potential for substantial growth in order to provide for both your future and that of your family. It is intended for people who will retire outside of the UK.

A QNUPS is an unapproved non-UK pension scheme. This does not mean that QNUPS are not recognised by HMRC; they are in fact defined by UK legislation and a UK taxation treatment of these schemes has been set out by law. Unapproved instead means that the usual taxation benefits attached to approved pension schemes are not in place. For example, contributions to approved UK pensions are subject to tax relief while contributions to QNUPS are not. The positive side to being unapproved— and the side that would make someone interested in investing in a QNUPS— is that there are no limits on the contributions that can be made, and very little limitation on what investments the QNUPS can make.

A QNUPS also offers an investor the chance to contribute directly to the growth of their own pension fund. Since a QNUPS can invest in private trading companies, it could acquire shares in a beneficiary’s private trading company, meaning that any growth in value of the company and any dividend payments relating to those shares would directly benefit the pension fund. Many people feel that they will be able to outperform a broad portfolio of shares of the type in which standard pensions might invest. The transfer of shares to the QNUPS should allow post-corporation tax profits to be paid to the QNUPS without additional tax allowing you to use those profits to grow your retirement fund.QNUPS offer freedom from restrictions

Since a QNUPS is by definition offshore, the building of the retirement fund is virtually exempt from UK taxation. No UK capital gains tax should be payable on the increase in value of trust funds, and with sensible structuring, the UK income tax on returns generated by investments should be limited to effective basic rate tax on UK source loan interest and rental income. All other payments should be free from UK taxation. The trustees can even make interest-bearing loans of up to 25% of the trust fund to beneficiaries.

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QNUPS offer freedom from restrictions

Since a QNUPS is by definition offshore, the building of the retirement fund is virtually exempt from UK taxation. No UK capital gains tax should be payable on the increase in value of trust funds, and with sensible structuring, the UK income tax on returns generated by investments should be limited to effective basic rate tax on UK source loan interest and rental income. All other payments should be free from UK taxation. The trustees can even make interest-bearing loans of up to 25% of the trust fund to beneficiaries.

This freedom from restriction and taxation should allow a QNUPS that makes sound investment decisions to produce returns well beyond what would be possible through more conventional pension structures. Once retirement age has been reached, the QNUPS falls back into a more familiar pension regime.

This highlights the purpose of a QNUPS. Putting money in and getting it back out is no more tax efficient than a conventional pension. It is the scale and scope of investments and the potential tax-free growth that can be generated within the structure that make this scheme more attractive for the right investor.

It is important to note that, because a QNUPS is specifically intended for individuals retiring overseas, UK residents can run the risk of incurring higher overall tax liabilities than otherwise by using a QNUPS.

If you would like more information on setting up a QNUPS to provide for your retirement, please contact Tax Innovations on 01962 856 990 or customerservice@taxinnovations.com.

Key benefits:

No UK Tax on Pension Income when retiring overseas
The income you receive from a QNUPS is not subject to UK income tax, meaning you can enjoy your pension benefits abroad without worrying about UK tax liabilities.
No Limits on Contributions
QNUPS offer complete freedom when it comes to contributions. Unlike UK pension schemes, there are no restrictions on the amount you can contribute, making it ideal for those wishing to transfer significant assets or cash into their retirement fund.
Tax-Free Investment Growth
All investment growth within a QNUPS is tax-free, which allows your wealth to accumulate over time without the burden of UK taxation on gains.
Wide Range of Investment Options
With a QNUPS, you have the flexibility to invest in a broad range of assets, including property, cash, and other investments, allowing for a highly diversified and personalised retirement plan.
Global Flexibility
QNUPS can be set up in a number of different jurisdictions, enabling you to choose a location that offers political stability and tax efficiency. This makes QNUPS particularly attractive for expatriates and those retiring abroad.

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How it works

Setting up a QNUPS is straightforward with the right guidance. Here is how we’ll help you:

Free Phone Consultation – We assess your financial situation and goals to determine if QNUPS is the best option for you.
Bespoke Strategy – Our experts design a personalised QNUPS structure based on your assets, retirement location, and long-term financial objectives.
Implementation & Ongoing Support – We handle the legal and administrative process of setting up your QNUPS, ensuring compliance with both UK and international regulations.

Why choose Tax Innovations?

With increasing scrutiny on international pension schemes, it is more important than ever to work with experts who know the nuances of QNUPS and can ensure full compliance. At Tax Innovations, we specialise in guiding clients through complex tax structures to maximise their savings abroad.

Expert Guidance: Our team understands the intricacies of QNUPS and has successfully helped numerous clients protect their wealth while retiring abroad.
Tailored Solutions: We don’t believe in one-size-fits-all. Your financial goals are unique, and we create personalised QNUPS plans to suit your needs.
Complete Compliance: As tax regulations change, we ensure your QNUPS stays fully compliant with UK and overseas tax laws, giving you peace of mind.

Whether you are planning to retire abroad or want to explore tax-efficient retirement options, we are here to help. Contact us today to discuss how a QNUPS can secure your financial future and protect your wealth from UK Inheritance Tax.