QROPS - Horizon International Pension Plan

Background

The Horizon International Pension Plan (HIPP) is a term used for the non-Guernsey resident members of the Horizon Plan administered by Gower Pensions Management Limited (GPML). The Horizon Plan is an approved Defined Contribution Retirement Benefit Plan established by way of an irrevocable Trust Deed. It is both Guernsey Income Tax approved and UK HMRC QROPS approved.

The aim of the scheme is to provide a highly flexible, tax efficient vehicle in which to save for the purpose of providing an income at retirement.

Key benefits

No requirement to purchase an insurance company annuity
Any residual fund upon death of Member is distributed
Greater flexibility on drawing benefits
Benefit paid gross and not subject to Guernsey tax*
No limit on contributions or fund size
Assets held in a HIPP grow free of taxation – except for any withholding taxes
No hidden penalties or exit charges
Outside the influence of the EU
* Unless you become a Guernsey resident tax payer

Payment of benefits:

By transferring to HIPP, the member would automatically receive future benefit payments without the deduction of tax at source. The member will then be responsible for the declaration of income in their current country of residence (GPML recommend that you obtain tax advice within your country of residence).

At what age can benefits be taken from the HIPP?

Flexible retirement dates - typically between 50 and 75 years

What are QROPS?

Qualifying Recognised Overseas Pension Schemes (QROPS) approved by UK HM Revenue & Customs (HMRC).
HMRC allows for inward transfers from approved UK pension schemes to QROPS.
This means that anyone who has either left the UK or is intending to leave the UK and who has a UK approved (registered) pension, has the opportunity to transfer this outside of the UK.

UK Pension Restrictions: While contributions to a UK pension plan benefit from tax exemption, restrictions are placed on the benefits drawn from UK pensions, which include:

Requirement to purchase an annuity, the income from which is subject to income tax.
Upon death, the loss of annuity residual value.

However, non-UK residents (or those considering leaving the UK) could transfer their UK accrued pension into a QROPS which, depending on the jurisdiction of the QROPS, may offer significant benefits.

Investment Strategy

Greater investment choice compared to that of UK approved pension schemes.
Investment options are wide-ranging and include the ability to invest in stocks, bonds, investment trusts and life policies.
Non-standard assets such as property, private equity and land may also be held.
You may appoint an investment advisor of your choice, including yourself (subject to Trustees approval) or select from a number of pre-approved investment managers.

Who is eligible to join the HIPP?

HIPP is open to anyone over 18 years of age and under the age of 75 years (excluding Jersey residents).

Contact a Gower Pensions consultant today to receive more information and advice.