QROPS

The Mercator Retirement Plan was established as a “Qualifying Recognised Overseas Pension Scheme” (QROPS) based in Guernsey, registered with Her Majesty’s Revenue and Customs (HMRC) and the States of Guernsey Income Tax Authority.

In December 2011, the UK government published its intention to amend the regime for approval of QROPS schemes. As a result, the States of Guernsey enacted a new Section 157E of the Income Tax (Guernsey) Law 1975 in March 2012 in an attempt to ensure that existing QROPS schemes administered in the island are capable of being amended in order to meet the newly published criteria for approval. The Guernsey Association of Pension Providers has obtained an opinion from UK counsel that the enactment of this new statutory provision will ensure that Guernsey QROPS will be compliant with the changes in HMRC legislation released on the 21st March 2012.

Mercator has received confirmation from the States of Guernsey Income Tax Authority that it’s QROPS Schemes have been approved under the new Section 157E. However, on 5th April 2012, HMRC published a guidance note indicating that it would only give approval to QROPS schemes which are open only to residents in the country in which they are run. Immediately thereafter HMRC removed the list of approved schemes from its website and when it the list was reissued on 12th April 2012, only 3 of over 300 QROP arrangements established in Guernsey remained on the list.

As the Mercator QROPS schemes, like all Guernsey QROPS open to non-Guernsey residents, are currently not shown on the HMRC published approved list, transfers from UK registered pension schemes may be taxed in the United Kingdom. To date, we have not been advised by HMRC why the Mercator QROPS have been removed from the revised QROPS list and we have therefore requested that HMRC provide clarification for this action. In the meantime, existing members will continue to have their funds looked after by our professional QROPS team.

Information links:

HMRC revised list and introductory notes

Guernsey Association of Pension Providers (GAPP) Press Notice of 12 April 2012 

Contact Clive Damsell