Expat UK investors who had their pensions transferred into a tax scheme in Hong Kong could lose 55 per cent of their savings after HMRC struck the scheme off its approved list. HMRC has revoked the status of the Beazley Consulting Pension Scheme - owned by expats all over the world - saying it does not meet its criteria for Qualifying Recognised Overseas Pension Scheme status.
The savers face a 40 per cent unauthorised payment charge and 15 per cent surcharge on the value of the transfer. HMRC is understood to have offered to waive the 15 per cent surcharge if investors can show that they genuinely believed they were investing in an eligible Qrops scheme. It will also “view sympathetically”requests not to collect the 40 per cent unathorised payment charge, according to the law firm acting on behalf of the scheme.
In a statement, law firm DLA Piper, which has been brought in to act on behalf of Beazley, says: “The Beazley Consulting Pension Scheme was set up in 2007. At the time Hong Kong lawyers advised that the scheme met HMRC’s criteria to qualify as a Qualifying Recognised Overseas Pension Scheme in the UK. Appropriate legal advice was taken in Hong Kong before Beazley Consulting submitted its application to HMRC and HMRC accepted that the scheme met its relevant criteria.
“Some 18 months later, after taking its own advice, HMRC decided that the regulations to which the scheme was subject did not meet its criteria and that the scheme no longer qualified as a Qrops. This decision also affected other similar schemes. Since then Beazley Consulting has been working closely with HMRC to resolve the issue and has advised members of the best way forward.”
HMRC refused to comment on a specific scheme.
HMRC clamps down on Hong Kong Qrops scheme | News | Money Marketing
Source Money Marketing
7th September 2010