FT. LAUDERDALE, Fla. - Feb. 24, 2016 - PRLog -- The new Flat rate UK State pension, heralded as good news for pensioners, will be very bad news for many. On face value, the new scheme looks like an increase for most pensioners.
But the biggest group to lose out will be those who are members of a contracted out Final Salary pension scheme, as this will reduce your entitlement to the full state scheme. Additional bad news is that the index linking guaranteed by the Government will be lost. Importantly the inflation linked top up was provided by an increase to your State pension payments. From April 2016 this will no longer be the case. The average loss may be as high as £30,000 over your retirement.
The Department for Work & Pensions have confirmed that the ‘contracted out’ element of a Final Salary pension will indeed not be inflation-linked, under the new state pension rules.
And there is more. The Government has already started consultation to look at removing personal allowances for UK non-residents. This will see you taxed on all income derived in the UK. At present, the first £10,600 of UK income is not taxed.
The Government is also looking at reducing maximum benefits that can be provided by a Final Salary pension scheme, and punitively taxing any provision over this level. Some suggest the reduction could be as much as 25%, with a tax rate of 55%.
A QROPS transfer is not for everyone, but for an increasing number of people no longer living in the UK, a QROPS transfer may provide protection from these radical pension changes.
Have your UK Final Salary pension scheme reviewed by a UK FCA qualified financial adviser. A TVAS will compare a QROPS transfer with the benefits provided by your UK scheme. It will confirm which the most beneficial option is.
The Government is losing revenue from UK pension schemes transferring to QROPS. In 2015, it put the brakes on with a partial ban on QROPS transfers. It came close to banning all Final Salary pension scheme transfers. It did ban Unfunded Public schemes from transferring. Now that the members are locked in, they are at the mercy of the Government. Viewing pensions as a treasure chest, they can plunder at will.
Let us, however, end on a positive note. For many, transfer values are the highest they have ever been, and at present, the option to transfer to a QROPS is still there.
Read more here:
http://www.waterstone-investment-associates.com/#!final-salary-qrops-transfers/cvwp
Email us: jrhughes@waterstone-qrops.com
Contact
Watersone Investment Associates
jrhughes@waterstone-qrops.com
jrhughes@waterstone-qrops.com
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Read Full Story - UK Government will raid Final Salary (DB) pension schemes again April 2016. A QROPS transfer may be your answer | More news from this source
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