A transfer to a
qualifying recognised overseas pension scheme
(QROPS) is a
benefit crystallisation event (
BCE).
Whenever a BCE occurs, a certain amount is deemed to
‘crystallise’ for
lifetime allowance purposes. The capital value of
the benefit or ‘event’ being used up on the BCE is
measured, on a prescribed basis. This amount can then be compared
to the percentage of the lifetime allowance in force at the time of
‘crystallisation’ which the
member still has available to him.
When a member asks to transfer to a QROPS, you should satisfy
yourself that the scheme meets the QROPS conditions that are set
out in
RPSM14101020 to
RPSM14101050. You can ask HMRC to
confirm that the scheme has notified HMRC that it is a QROPS and
has met the other conditions specified in
RPSM14101050. The amount of the
transfer value will be the amount crystallised for lifetime
allowance purposes. You should also satisfy yourself as to whether
the member has sufficient lifetime allowance left to cover this
amount.
If the member does not have sufficient lifetime allowance
available to cover the amount to be transferred, there will be a
lifetime allowance charge (see
RPSM11105000).
You should also report the transfer to HMRC on the Event
Report. You can do this using Pension Schemes Online through the
HMRC website.
| Glossary ( RPSM20000000) |
