HMRC clarifies its position on residential property within a QROPS. November
14th 2010
HM Revenue & Customs has at long last issued clarification that residential property is not a permitted investment within qualified recognised overseas pension schemes before or after the five- year reporting period.
The note, published online in the HMRC manual clearly states that an unauthorised payment charge is not dependent on how long a member has been non-resident. It says: "It applies regardless of whether or not a transfer member has been non-resident for more than five tax years. Nor is there any time limit on the requirement that the manager of a QROPS reports to HMRC any payments that are referable to a transfer member's taxable asset transfer fund."
Anyone transferring their UK pension across to a QROPS cannot under any circumstances use that money within a QROPS to invest in residential property.