The Isle of Man has introduced new pension legislation that will directly assist British expatriates who are taking out QROPS
From 19 October the new legislation will be introduced, after being passed in Tynwald- the Isle of Man’s parliament. The new legislation is expected to meet HMRC’s recognised guidelines for pension transfers which will enable QROPS holders to transfer into the island.
Currently money taken from Isle of Man QROPS was subject to a maximum of 20 percent income tax. The new system will see non Manx residents receiving gross payments that are not subject to Isle of Man income tax.
Malcolm Couch, head of the Isle of Man government's Income Tax Division, said: “I can confirm that Tynwald has approved an order which will create a new form of pension in the Isle of Man from Friday of this week and which also tidied up some miscellaneous issues resulting from our last major pension taxation reforms two years ago. All schemes under the new rules will have a local provider, and will be fully regulated by our Insurance and Pensions Authority."
The ruling means that the Isle of Man will now be able to compete with other offshore jurisdictions that handle QROPS, like Guernsey and Jersey.