International Pensions

For more than thirty years the Blacktower Group has provided its individual and corporate clients with world-class independent wealth management advice through offices across Europe and the UK as well as in the United States.

Clients in the Caribbean can take advantage of the advice and services provided by our specialists in Georgetown, Grand Cayman.

Cross-border wealth management is complex but it often also brings with it the possibility of exciting financial opportunities – for example in relation to the way you structure and manage your international pensions.

UK Pensions

There are two major categories of UK pensions: Defined Benefit Schemes (often referred to as a ‘Final Salary Schemes’), and Defined Contribution schemes (often known as ‘money purchase’ schemes).

Although these two types of schemes have dominated the UK pension landscape for some time, nowadays there are legitimate questions about their long-term viability, with the UK Pension Protection Fund reporting that, as of March 2017, even the most promising schemes were 25% underfunded, while Defined Contribution Schemes continue to offer little in the way of guarantees.

Furthermore, these pensions may be entirely unsuitable for an expat who lives in the Caribbean, not only in terms of establishing a simple and reliable income stream, but also in terms of cross-border tax efficiency.

International Pensions Options

Whether you are the member of a Defined Benefit Scheme or a Defined Contribution Scheme, if you live in Grand Cayman or elsewhere in the Caribbean, you have several options for a transfer.

These include the following:

  • SIPP (Self Invested Pension Plan): A SIPP gives the retirement investor a great deal of freedom to self-invest across a broad spectrum of asset classes. However, unless the SIPP member investor has a strong investment background, it is recommended that they use a wealth manager or other professional to manage their SIPP investments. A SIPP can be flexible, tax-efficient and useful for inheritance planning. Furthermore, there are three main types of SIPP: a full SIPP, a low-cost SIPP and a Hybrid SIPP. SIPPs remain subject to UK pension regulations.
  • QROPS (Qualifying Recognised Overseas Pension Scheme): Unlike a SIPP a QROPS is not governed by UK pension regulations, although there are a number of necessary reporting and other requirements. QROPS offer a great deal of flexibility, particularly in relation to inheritance and legacy planning.

Blacktower in the The Cayman Islands

If you live in or are about to move to The Cayman Islands or another location in the Caribbean, Blacktower can help you consider the best way to structure your pension benefits, including the possibility of an international pension transfer. Contact us today by calling us or by using the online form at the top of this page.

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