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HMRC urged to restrict Qrops’ advice

Abbey Expatriate Services has written to the Government calling for advice on transferring UK pensions overseas to be restricted to UK-regulated advisers.

Managing director Sam Instone says current rules allow unregulated international advisers into the market.

He says: “HM Revenue and Customs’ legislation seems to have opened a loophole for advisers outside the UK to start advising on UK schemes without the client being fully aware or protected.”

The FSA does not regulate Qrops as they are overseas schemes and companies providing financial advice from outside the UK fall outside its jurisdiction.

HMRC is only responsible for approving Qrops and is not obliged to check the legitimacy of their distribution.

Instone is lobbying for increased consultation between the FSA and HMRC to ensure that customers receive the correct advice on UK pension transfers.

He believes that advice on UK pension transfers should be restricted to UK regulated advisers who have a genuine understanding of the tax system in all relevant jurisdictions.

A HMRC spokesman says: “HMRC cannot advise on the suitability of one financial product against another, regardless of where it comes from but the HMRC website does provide information on the tax consequences of someone’s choice, including a decision to transfer their pension fund to a Qrops.”

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