Guernsey Leads QROPS Market

HMRC data shows that Guernsey is the leading jurisdiction for QROPS overseas pension schemes.

London, UK (Pryce Warner International) September 14th, 2011 – Between January 1st 2011 and the 30th of June 2011, 32% of people transferring their pensions outside of the UK chose Guernsey as the new jurisdiction.

Despite new regulatory mechanisms New Zealand placed second at 28%. Australia, the most popular destination for retiring Expats, had 20%, while the Isle of Man dropped from being one of the most popular jurisdictions to the least with only 5%.

Australia remains the most popular jurisdiction for QROPS overall however. Since 2007 47% of all QROPS have been transferred there. New Zealand is overall the second most popular destination with 23% of all QROPS having been moved there. This is due to the fact that Australia and New Zealand remain the most popular locations for British Expats to retire due to the lack of a language barrier as well the excellent lifestyle and financial opportunities.

Another reason Australia and New Zealand have the highest rate of QROPS transfers is that they controversially remain countries where Expats pension rates remain frozen at the rate they were first drawn out on. This means that they often see the value of their pension drop dramatically over time and therefore are in more immediate need of some other form of pension scheme.

Guernsey has overall received 10% of QROPS transfers since 2007, but clearly its popularity is growing. One of the reasons that Guernsey has seen less transfers than its Antipodean counterparts is that is mainly used by people retiring outside of Guernsey. While those retiring in Australia and New Zealand can set up a QROPS there, people in Europe or Asia often are better of opting for a “third country” to set up a QROPS and of these Guernsey appears to be the most popular.

It is estimated that the total global value of all assets transferred into a QROPS was £121m in 2007, £358m in 2008, £366m in 2009 and £471m in 2010. It is estimated that in 2011 the total amount will pass £500m. Overall, retiring British Expats have transferred over £1.3bn into QROPS schemes around the world.

David Harra, a Senior Market & Investment Analyst with Pryce Warner International, a financial services provider for Expats, commented: “Though Australia and New Zealand lead the QROPS market overall, Guernsey is clearly the most popular "third country" destination for those wishing to set up a QROPS outside of the country they are planning on retiring in. We have always seen Guernsey as the most preferable jurisdiction to offer our QROPS due to its excellent financial infrastructure and stringent pension regulations. While some jurisdictions have attempted to exploit loopholes in HMRC rules, Guernsey has always opted instead for strict adherence and ever-increasing methods of regulation. With its considerable history in the overseas pension market, Guernsey is certainly one of the best places to start a QROPS.”

Pryce Warner International Group provide International Asset & Investment Management, Independent Financial Advice & QROPS Overseas Pensions.

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By: Aneil Fatania
Financial Editor
Pryce Warner International Group
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