Most cross-border pension conversations start in the wrong place: with a product. A broker mentions a "QROPS", a colleague mentions their SIPP, and the client is asked to choose between two things that were never really the question. The question is what the pension is for, when it is needed, in which currency, and under which country's tax rules it will be drawn.
The three real options
There are only three destinations for a UK defined-contribution pot when you leave the UK.
- Leave it where it is. Perfectly legitimate. Modern workplace and personal schemes are cheap, and a pot you understand is worth more than a pot you have optimised.
- Consolidate into an international SIPP. The pension stays UK-registered and FCA-regulated, but you gain multi-currency dealing, a wider investment universe and an adviser who can actually be reached from your time zone.
- Transfer to a ROPS (formerly QROPS). The pot leaves the UK regime entirely for a recognised overseas scheme — usually Malta or Gibraltar for internationally mobile clients.
The Overseas Transfer Charge is the first gate
A transfer to a ROPS attracts a 25% Overseas Transfer Charge unless an exclusion applies — broadly, that you are resident in the same country as the scheme, or both are within the EEA/Gibraltar and you are EEA-resident. The rules have tightened twice since 2024, and exclusions are tested at transfer and can be clawed back if your residence changes within five full tax years.
We have seen more value destroyed by a 25% charge than gained by every currency and tax advantage combined. This test comes first, in writing, before anything else is discussed.
Defined benefit: the presumption is "don't"
If your UK pension is a defined-benefit (final salary) scheme, the regulatory starting point is that transferring is unsuitable. Transfer values have fallen sharply from their 2021 peaks as gilt yields rose. Giving up an inflation-linked, guaranteed, spouse-protected income for a capital sum needs a very specific reason: serious ill health, no dependants, or an estate-planning objective that the scheme cannot serve. Transfers above £30,000 require advice from an FCA-authorised pension transfer specialist. That is not a formality to be worked around.
Where the tax actually lands
Your pension is taxed where you are resident when you draw it — subject to the relevant double-tax treaty, which sometimes assigns taxing rights to the source state instead. The UAE has no personal income tax but no comprehensive treaty relief on UK-source pension income; Portugal's NHR successor regime treats foreign pensions differently again; the US treats certain foreign pensions in ways that will surprise anyone who has not read the treaty article.
The practical point: the destination scheme should be chosen after the residence plan, not before it.
Currency is a strategy, not an afterthought
If your liabilities are in euros or dirhams and your pot is in sterling, you are running a currency position whether you intended to or not. An international SIPP or a Malta ROPS can hold and draw in multiple currencies. That is often the single largest practical benefit of a restructure — larger than the tax difference.
The five tests we apply
Before we recommend anything, we answer these in writing:
- Charge test. Does any transfer trigger the Overseas Transfer Charge, now or within five years?
- Guarantee test. What guaranteed benefits, protected tax-free cash or protected pension ages are being given up?
- Cost test. Total cost of ownership — scheme, platform, dealing, adviser — against the current arrangement.
- Currency test. Which currency will the income be spent in, and from what age?
- Succession test. What happens on death, under both the scheme rules and the succession law of your residence?
What good looks like
For most internationally mobile clients with pots under roughly £300,000, the honest answer is consolidation into a low-cost international SIPP, drawn in the right currency, with a clear residence plan. ROPS earns its place when the pot is large, the client is settled in a treaty-friendly jurisdiction, or a lifetime-allowance-style constraint makes the UK wrapper genuinely inefficient.
We charge fixed fees for the analysis and take no commission from any scheme or platform. If the answer is "leave it alone", we will tell you that and invoice for the work — which is why we are the wrong firm for anyone hoping for a free review.
