The UK's controversial introduction of a 25% tax charge on
the transfers from UK pensions to Qualifying Recognised Overseas
Pension Schemes (QROPS1) has found backing from the
Malta Association of Retirement Scheme Practitioners (MARSP). MARSP
stated in a press release of the 10th March, 2017 that despite much
of its initial criticism it is a "positive for Malta" and
for the wider pensions industry, especially in Europe.
In his Spring Budget 2017, UK Chancellor of the Exchequer Philip
Hammond announced a significant shift in rules, causing transfers
to QROPS requested on or after 9 March 2017 to be taxable unless,
from the point of transfer, both the individual and the pension
savings are in the same country, both also being within the EU or
the European Economic Area (EEA).
Failure to qualify under such criteria causes a 25% tax charge
to be levied on the transfer which is deducted before the transfer
by the scheme administrator or scheme manager of the pension scheme
making the transfer.
MARSP stated that this was an immediate measure, pointing that
it is probably intended to counter abuse the tax relief given on
contributions to UK pension schemes and to help clamp down on
fraud, scams and so called "pension release". It also
added that the imposition of a tax charge when transferring UK tax
relieved pension funds from the UK to a non-European jurisdiction,
or country of residence, should discourage the transfer of smaller
pension pots and help prevent pension fraud.
Nevertheless, Brexit's impact can still have unexpected
repercussions in conjunction with the new rules, especially in
relation to the question as to whether UK tax relieved pension
funds are still portable in Europe even after the final cut off
In light of these new developments, MARSP noted that the
highly-regulated and monitored pensions industry in Malta remains
very much open for business. Its members have expressed confidence
in the future and the support of the regulator and the transparent
Maltese tax regime. Malta, being a full member of the European
Union, can only be strengthened by this move.
Created in 2011, following the establishment of a number of
pensions scheme administrators and trustees in Malta, initially
focusing on the international pensions market, with an emphasis on
British expatriates, MARSP now has over 15 members whose businesses
cover QROPS, international pensions and the local Maltese pensions
market representing substantial assets under management. MARSP is
primarily concerned with regulation, taxation and industry best
practice. MARSP meets regularly, on a bi-monthly basis. Its key
sub-committees regularly liaise with and lobby the Maltese
Regulators (Malta Financial Services Authority) and the Maltese
Inland Revenue. In addition, meetings cover general topics of
industry best practice and new local and international
1 QROPS is an Occupational Pension Scheme provided by the
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