Dear Reader -

We've had some good feedback on our offer and so it continues. Remember, a reduced trustee fee of £695 set up and £695 per annum where you use a mini bond with either Generali or RL360. Unlike others in the market we do not take underlying commission for the bond. Our minimum for this is £30,000.

5 year rule and returning to the UK

This is one area which seems to cause a lot of confusion and misunderstanding. In its simplest terms the 5 year rule means the trustees have to report any payments from the trust to HMRC for the first 5 full tax years that a member is a non UK resident. However, any reputable trustee will only make payments within set limits for the life of the policy, not just the first 5 years.
So what does it actually affect? Income and death tax benefits of being offshore are immediate on taking out a QROPS. However, how long you've been offshore at the time if taking benefits defines whether you are treated under the UK regime or as overseas pension. If you are offshore and return to the UK before taking benefits, then move offshore again, the 5 year clock is reset and starts ticking payments and returning to t he UK.

Client Position	Income	Death	Maximum Lump Sum
< 5 years offshore	Nil, but possible in country of retirement	Nil tax in jurisdiction	25% of transfer value
> 5 years offshore	Nil, but possible in country of retirement	Nil tax in jurisdiction	30% of fund value
> 5 years return UK	90% taxable in UK as earned income	Member payment charge 55%	30% of fund value
> 5 years QNUPS prior to UK return	90% taxable in UK as earned income	Nil tax	30% of fund value

Gower has a clear mechanism in dealing with your client needs in all of these potential situations. As long as the clients has been offshore for full 5 tax years and starts taking benefits, we can convert them to a QNUPS prior to returning to the UK and there is no 55% member payment charge. Why pay for an offshore pension when you would end up with an onshore tax position on returning to the UK?

Local Government Transfers

We understand from the NHS that they have suspended both transfer calculations and payments although they will still pay where forms are returned within the 3 month guarantee period. This suspension is as a result of guidance from the UK Government actuarial department and will almost certainly apply to all government related schemes. It is likely to take 2-3 months but may vary between schemes.

Gower has a clear
mechanism in dealing with
your clients needs in all of
these potential situations.