Isle of Man QROPS Trust seeks HMRC QROPS ruling
11 December 2010
An Isle of Man QROPS provider has written to HM Revenue & Customs for clarification over changes to the island’s tax rules that now allow QROPS members to take 30% tax-free cash based on the initial transfer value of the fund. Last month, the Isle of Man government changed its pension legislation to meet HMRC’s QROPS regulations.
It now allows 30 % of a member’s fund to be taken as tax-free cash, leaving 70% providing an income.
Fedelta Pensions has written to HMRC following a disagreement between providers and HMRC. They want clarification whether it will apply the 70/30 split to the initial transfer value of the fund or the value of the fund at the point when income is taken, based on the total fund value on that date.
HMRC says it does not comment on individual enquiries.