QNUPS will be a new and unfamiliar term, but the Qualifying Non-UK Pension Scheme regime is very attractive as a supplementary or alternative pension scheme for both UK residents and expatriates. The Praxis International Pension Scheme (PIPS) has been launched in Guernsey to provide retirement benefits under the QNUPS regime.:

The key benefits of PIPS are:

  • no statutory restrictions on the level of contributions (but no tax relief is available in respect of contributions);
  • the fund grows free from CGT and Income Tax (except in the case of UK-source income and any irrecoverable foreign withholding taxes);
  • there are minimal restrictions on the types of investments which can be made (and investments may include residential property, private company shares);
  • loans of up to 25% of the fund may be made to the member;
  • there is no requirement to purchase an insurance annuity (the annuity or pension can be drawn directly from the fund itself);
  • a lump sum benefit of up to 25% of the fund can be taken free of UK tax;
  • the annuity or pension is subject to UK Income Tax at 90% of the member's marginal tax rate if UK resident (or is not subject to UK tax if the member is no longer UK resident); and
  • the member's fund is exempt from UK Inheritance Tax.

In order to take advantage of PIPS the member must accept that it is a bona fide pension scheme. This means that, generally, no benefits can be taken prior to attaining age 55; the member must start taking benefits on or before his 75th birthday and at least 70% of the member’s relevant scheme funds must be designated by the scheme manager for the purpose of providing the member with an income for life.

The combination of the tax advantages and flexibility of PIPS and the general QNUPS regime result in a highly attractive supplementary or alternative pension regime which is already generating huge interest from UK residents (including foreign domiciliaries who are "deemed domiciled" for Inheritance Tax purposes) and UK expatriates alike.

Praxis International Pension Scheme       Download document

 

 

QNUPS

QNUPS will be a new and unfamiliar term, but the Qualifying Non-UK Pension Scheme regime is very attractive as a supplementary or alternative pension scheme for both UK residents and expatriates. The Praxis International Pension Scheme (PIPS) has been launched in Guernsey to provide retirement benefits under the QNUPS regime.:

The key benefits of PIPS are:

  • no statutory restrictions on the level of contributions (but no tax relief is available in respect of contributions);
  • the fund grows free from CGT and Income Tax (except in the case of UK-source income and any irrecoverable foreign withholding taxes);
  • there are minimal restrictions on the types of investments which can be made (and investments may include residential property, private company shares);
  • loans of up to 25% of the fund may be made to the member;
  • there is no requirement to purchase an insurance annuity (the annuity or pension can be drawn directly from the fund itself);
  • a lump sum benefit of up to 25% of the fund can be taken free of UK tax;
  • the annuity or pension is subject to UK Income Tax at 90% of the member's marginal tax rate if UK resident (or is not subject to UK tax if the member is no longer UK resident); and
  • the member's fund is exempt from UK Inheritance Tax.

In order to take advantage of PIPS the member must accept that it is a bona fide pension scheme. This means that, generally, no benefits can be taken prior to attaining age 55; the member must start taking benefits on or before his 75th birthday and at least 70% of the member’s relevant scheme funds must be designated by the scheme manager for the purpose of providing the member with an income for life.

The combination of the tax advantages and flexibility of PIPS and the general QNUPS regime result in a highly attractive supplementary or alternative pension regime which is already generating huge interest from UK residents (including foreign domiciliaries who are "deemed domiciled" for Inheritance Tax purposes) and UK expatriates alike.

Praxis International Pension Scheme       Download document

 

 
WHO TO CONTACT
David Hearse BSc
Deputy Managing Director

David Piesing FCIS
Director - Head of Wealth Structuring

John Bradley BA (Hons) FCA CTA
Consultant

Anna Rhydwen-Jones Dip Law BSc (Hons)
Senior Client Relationship Manager

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