Keith Boniface, marketing director for Brooklands Pensions, a multi-jurisdictional, Malta-based self-invested pensions provider, stressed that QNUPS are not for everyone, but for a select group of wealthy to extremely wealthy individuals – with assets, including their main residence, of at least a couple of million pounds.
He also stressed the need for them to be properly understood and structured to avoid any potential problems, such as the unwanted attention of HM Revenue & Customs.
“We’re not trying to get articles in the Daily Mail saying that everyone should have one [of these],” Boniface, whose company is one of the few thus far to actively promote QNUPS, told his audience.
Later, Boniface added: “We only sell them to the right clients, through the right advisers. QNUPS are the opposite of a commodity product.”
New since 2010
QNUPS, as many advisers are still discovering, are a relatively new type of trust that came into existence on the 15th of February 2010, with the intention of retrospectively restoring inheritance tax (IHT) protection to UK pension funds that transfer to a qualifying recognised overseas pension scheme.
QNUPS experts say that they are particularly well suited to individuals with significant investment income that would benefit from the ability to roll up gains tax free, and who, because of their wealth, are likely to have already reached their lifetime allowance for tax-free pension contributions, now at £1.5m.
QROPS Bureau principal Andrew Dobson stressed the benefits that QNUPS have of being able to hold “virtually any asset”, including property investments (excluding one’s residence) – as well as their potential for enabling clients to tax-efficiently pass on their wealth to children and grandchildren.
“It surprises me how young people are when they realise that at some point in the future, their family, their nearest and dearest, won’t inherit 40% of the wealth that they have worked very hard to accrue,” Dobson said, explaining the reason many people are receptive to products that enable them to mitigate some of their IHT obligations.
“It really rankles with people that that is the case…that after they work so hard, and pay tax and capital gains tax, that they will then be penalised a [further] 40%.”
As reported, Brooklands Pensions last month launched a QNUPS for UK residents that it says gives them full inheritance, income and capital gains tax exemption, through the incorporation of an international insurance bond.