So, how easy is it to retire abroad?

Home So, how easy is it to retire abroad?
Financial Nathan Waldron
12 Jan 2023

Many individuals still dream of spending their golden years in another country, but it's crucial to organise your finances before making the transfer. The tax repercussions for your private pension are among the important factors to consider.

Where will you pay Tax on your pension if you move abroad?

Where you are deemed to be a resident often determines how much tax you pay and where you pay it. If you retire abroad but are still considered a UK resident for tax purposes, you may have to pay UK tax on your pension.

Although you might have to pay tax in the nation you live in, you typically don't have to pay UK tax on your pension if you are no longer a resident of the UK. There are certain exceptions to this; in the UK, for instance, pensions from the civil service are always subject to UK tax.

Also note, there’s a chance you'll pay taxes in two nations if you reside in one without a "double taxation agreement."

What is a QROPS?

If you're thinking about retiring abroad, you've probably heard of "Qualifying Recognised Overseas Pension Schemes," or QROPS.

A qualifying recognised overseas pension scheme is a type of overseas pension plan recognised by HMRC that can receive pensions built up in the UK.

Private or workplace pensions may be paid to you wherever in the globe you choose to retire; you are not required to join a Qualifying Recognised Overseas Pension Scheme if you wish to retire abroad.

Joining a QROPS formed in the nation where you live will allow you to receive your pension in local currency and avoid the risk associated with fluctuating exchange rates.

It's important to keep in mind that your fund will be compared to the UK lifetime allowance if you move to a QROPS when under 75 years old. A 25% fee will be applied to any pension savings that are more than the present cap, which is set at £1,073,100.

A 25% HMRC charge applies to transfers to qualifying recognised overseas pension schemes unless one of the following requirements is met:

  • You are a resident of an EEA nation, and the qualifying recognised overseas pension scheme to which you are transferring to is based in another EEA nation.
  • You are resident in the country where the QROPS receiving your transfer is based.
  • You are transferring to a QROPS that is an occupational pension plan, and you are an employee of a sponsoring employer under the scheme.
  • You are transferring to a QROPS that is overseas public service scheme and you are employed by an employer that participates in that scheme
  • You are transferring to a QROPS scheme that is a pension scheme of an international organisation and you are employed by that international organisation.

Will a Financial Adviser be required to move abroad?

A financial adviser will likely be required for everyone who wishes to open a QROPS. Also, ensure you fully understand the expenses and fees you will incur - both for the advice and for investing through the new programme.

Where can you find the QROPS online?

You can find schemes that have told HMRC they meet the conditions here


  • The content on this page is regularly checked by our onboarded advisers and experts.

Be notified when we add new articles


Our website offers information about financial products such as investing, savings, equity release, mortgages, and insurance. None of the information on Sunny Avenue constitutes personal advice. Sunny Avenue does not offer any of these services directly and we only act as a directory service to connect you to the experts. If you require further information to proceed you will need to request advice, for example from the financial advisers listed. If you decide to invest, read the important investment notes provided first, decide how to proceed on your own basis, and remember that investments can go up and down in value, so you could get back less than you put in.

Think carefully before securing debts against your home. A mortgage is a loan secured on your home, which you could lose if you do not keep up your mortgage payments. Check that any mortgage will meet your needs if you want to move or sell your home or you want your family to inherit it. If you are in any doubt, seek independent advice.