The situation for QROPS in New Zealand has taken an upswing as a group of QROPS providers have come together to create a new code of conduct that will serve to revitalise the country’s ailing QROPS industry.
QROPS, Qualifying Recognised Overseas Pension Schemes, are a type of offshore pension transfer that has surged in popularity amongst the expatriate community over the last few years. However, some QROPS providers encounter problems if HMRC deem them to have not fully complied with established regulations.
While such cases are small, some rogue providers have been offering dodgy QROPS to create personal gain at the client’s expense. New Zealand is a jurisdiction that has seen the most accusations of such practice, and now efforts are being made to rectify the situation.
An organisation named Strategi is writing up a new code of conduct for the New Zealand QROPS industry that they hope will improve the reputation of New Zealand and create a safe QROPS environment.
A spokesman for the group said: “The New Zealand QROPS marketplace has suffered under global scrutiny amid claims that the jurisdiction is the 'wild west' of QROPS, an unfair label given that much of the foundations for this reputation can be laid at the feet of international advisers who have misled or bullied local product providers into some limited inappropriate new business. We believe that the reputation of the local QROPS marketplace can be restored through the adoption of a code of conduct, whereby product providers agree to turn away new business from unscrupulous advisers and abide by both the spirit of and the QROPS legislation itself.”
Despite a few problems in some jurisdictions the majority of QROPS providers are on the level. QROPS pension transfers can be highly beneficial for expatriates, giving improved rates of tax and greater flexibility with regards to how the fund is spent and also what happens to the fund when you pass away. If you are interested in a QROPS it is important that you speak with a provider that is fully regulated by HMRC. Speak to a recommended financial adviser for more information.