Clause 52 - Overseas pension schemes: general

Part of Finance Bill – in a Public Bill Committee am 9:15 am ar 11 Mehefin 2013.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Sajid Javid Sajid Javid The Economic Secretary to the Treasury 9:15, 11 Mehefin 2013

Individuals can transfer their pension savings in a UK-registered pension scheme to a QROPS, free of tax. The rules were designed to allow individuals who leave the UK permanently to continue to save for their retirement in their new country of residence. However, HMRC found that the QROPS regime was being used increasingly as a route to convert UK pension savings into a single lump sum payment to escape UK taxation. That was clearly unacceptable, so the Government published a statement explaining the policy intention of the QROPS regime on 6 December 2012.

The changes made by clause 52 strengthen the QROPS regime in a number of ways to ensure that it can be monitored more effectively and that the correct UK tax charges are applied. The clause specifies additional criteria that HMRC may use to exclude a scheme from being a QROPS, and also amends the powers to make regulations so that information will have to be provided by schemes that cease to be QROPS after the Bill receives Royal Assent. A new system of re-notification for QROPS will also be introduced.

Draft regulations were published for consultation on 24 May, and the consultation will close on 21 June. Subject to any amendments as a result of the consultation, the regulations will be introduced when the Bill receives Royal Assent.

If the hon. Gentleman has no other questions on the clause, I commend it to the Committee.