General FAQ
What is the Pension Age Test as it relates to QROPS?
Funds in a QROPS RRSP cannot be accessed before Age 55
I do not have any documentation from my former pension scheme?
We have traced frozen pensions from the most basic information, without any documentation, quite easily.
What is a Pension Scheme?
That is simply the name in the U.K. for a Company Pension.
What is a Frozen Pension?
The technical term for a Frozen Pension is a Deferred Pension Entitlement. Basically you were in a company’s pension scheme and then you left, leaving your pension benefits behind.
What is the 5 Year Rule I keep hearing about?
Once pensions are transferred out of the UK they only have to comply with the rules of the RRSP they are transferred into in Canada.
However, any withdrawals made from the RRSP within a 5 year period in which a person became UK non-resident for UK tax purposes could attract a UK tax liability.
For example if you arrived in Canada on 4th July 2003 you would be able to access your funds on 6th April 2009, free of any potential tax liability to the UK.
Can my UK pension go directly into a Regular RRSP here in Canada?
Yes as long as that RRSP has been accepted by the Inland Revenue as a QROPS.
Do I have better choices with transferring my Pension to Canada?
Yes. In the UK, at retirement you can receive your pension rights as a monthly or annual income stream (annuity). On the 6th April 2011 an alternative was introduced with the income drawdown pension which has capped and flexible options.
In Canada you can purchase a similar annuity or leave your funds in an RRSP, growing tax deferred, until you need to access some of it. We feel that in Canada, you have access to better options for your funds than those available in the UK.
What is QROPS?
QROPS stands for Qualifying Recognised Overseas Pension Scheme. Your UK pension funds would go into a Canadian RRSP which has been accepted by the Inland Revenue as a QROPS.