Planning for the Upcoming Changes before the April 2017 Deadline

The new rules will mean that IHT is charged on all UK residential property, including property held indirectly by non-doms through a structure such as an offshore company or a trust. As such, QNUPS could prove an effective IHT vehicle for those affected.

What is a QNUPS?

QNUPS are Qualifying Non UK Pension Schemes which came about as a result of UK HM Revenue & Customs (HMRC) legislation to ensure that the same inheritance tax protection given to registered pension schemes is available to qualifying non-UK pension schemes.

What are the Advantages of a QNUPS?

  • QNUPS may enable the member to mitigate both local wealth taxes during their lifetime and succession taxes on their death.
  • Income can be taken from age 55 and need not be taken until age 75.
  • There is no maximum contribution that can be made into a QNUPS.
  • On death, the value of the QNUPS is currently exempt form UK Inheritance Tax (IHT) and local succession taxes. The holder will not have to wait 7 years or distribute assets in order to prevent an IHT liability.
  • Assets can be invested and benefits taken in a currency of the holder's choice.
  • If the member returns to the UK, their assets held in the scheme will currently remain exempt from IHT and can be passed to their family free of this tax on their death.
  • Significantly, the trustees of QNUPS have no reporting obligations to HMRC.
  • Pension assets can grow tax free in Guernsey.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.