A wealthy Businessman from his thirties onwards, Mr. W had accumulated an amount almost equal to the HMRC lifetime allowance (currently £1.75 Million for 2009-10, then £1.80 Million for 2010/11 to 2015/16), within his Pension Scheme.
Now living overseas, he was very concerned to preserve these monies for his three children, after the ultimate demise of he and his wife.
After age 75, UK residents are required to purchase an annuity if they wish to avoid the 70-82% Tax levy on the Pension holder’s death. The 70% is standard but this percentage is increased should the individual fall into the Inheritance Tax Bracket (currently £325,000 for 2009-10). Other than athe much criticised annuity option, for overseas residents, a QROPS is the only way to avoid this ubiquitous charge, on lifetime Pension savings.
We wasted no time in performing a critical yields analysis, to ensure such a transfer was within “best advice” guidelines, in his case.
Once we had confirmed the transfer was in his best interests, we arranged fro the QROPS trustees to move swiftly to establish his Trust and we organised the Portfolio in such a way as to provide sufficient income, with the real possibility of Capital growth.
The conclusion is that we have been able to ensure that the better part of 2 Million Pounds will, on his demise, go directly to his Family.