For UK pension transfer to Portugal, think about things like potential tax consequences, current exchange rates, investment opportunities, and regulatory disparities between Portugal and the UK.
The discussion in this page includes:
- UK State Pension
- Options for UK Pension Transfer to Portugal
- UK Pension Transfer to Malta or Gibraltar
- UK Pension Transfer Tax Implications
Si desea invertir como expatriado o particular con un elevado patrimonio neto, que es en lo que estoy especializado, puede enviarme un correo electrónico (advice@adamfayed.com) o WhatsApp (+44-7393-450-837).
To ensure compliance with rules in both countries and to manage the complexity of foreign pension transfers, it is vital to seek guidance from asesores financieros with knowledge in this area.
UK State Pension
If you qualify and reach retirement age, you’ll still receive your UK state pension even while residing in Portugal, thanks to the country’s European Economic Area (EEA) status.
Options for UK Pension Transfer to Portugal
Many British expats living in Portugal are interested in transferring pension from the UK to secure their retirement plan.
Important note: As of today, Portugal unfortunately doesn’t have any local providers listed on the HM Revenue and Customs (HMRC) list of Qualifying Recognised Overseas Pension Schemes (QROPS).
UK Pension Transfer to Malta or Gibraltar
Transferring UK Pension to Malta QROPS
Consider transferring your UK pension to a Malta QROPS.
This option leverages the Double Tax Agreement between Portugal and Malta, ensuring your pension is only taxed in your country of residence (Portugal).
Additionally, a Malta QROPS transfer offers several advantages:
- Exemption from UK income tax (as long as you’re not a UK resident).
- Avoidance of UK inheritance tax.
- Elimination of the 55% lump sum payment tax.
Remember, UK income tax exemption applies only to non-residents of the UK.
Additionally, the 55% tax on lump sum payments after death still applies if you were a UK resident within five years of the payment.
Transferring to Gibraltar QROPS
While Portugal and Gibraltar lack a Double Tax Agreement, transferring your UK pension to a Gibraltar QROPS offers certain benefits:
- Exemption from UK income tax (as long as you’re not a UK resident).
- Avoidance of UK inheritance tax.
- Elimination of the 55% lump sum payment tax.
Similar to the Malta option, these advantages are only applicable to non-UK residents.
Additionally, the lump sum payment protection applies only if you haven’t been a UK resident in the five years preceding the payment.
UK Pension Transfer Tax Implications
Many British retirees in Portugal are exploring transferring their UK pensions to optimize their financial situation.
While Portugal boasts a double tax agreement with Malta, this isn’t the only option.
Transferring your pension to a QROPS provider in either Malta or Gibraltar can offer advantages like exemption from UK income tax and potential inheritance tax benefits.
However, carefully consider the pension transfer options available and seek professional guidance to navigate the process and choose the solution that best suits your individual needs and tax residency status.
¿Le duele la indecisión financiera?
Adam es un autor reconocido internacionalmente en temas financieros, con más de 830 millones de respuestas en Quora, un libro muy vendido en Amazon y colaborador de Forbes.
