Angela Brooks, chair of Pension Life, said: “Hammond has already done one screeching Budget U-turn. He should now do another on his wholly ill-conceived and utterly misguided thinking on QROPS.
“What does slapping a 25 per cent tax on QROPS transfers achieve? Primarily it disadvantages many genuine pension savers who are using bona fide, regulated advisers and who want to benefit from the advantages that transferring their UK pensions out of Britain can offer.
(Definitely read to the end of this post if you are affected.)
“What doesn’t it achieve? Stopping any of the current scammers using QROPS as the vehicle for their scams.”
Ms Brooks said: “The uncertainty over an individual’s possible future domicile outside the EEA – triggering the 25 per cent tax charge – has put a large question mark over pension and tax planning for many people.”
She said: “The QROPS tax seems designed to collect a large basket full of low-hanging-fruit tax, but without addressing the ills of some within the offshore pension industry: namely, the armies of firms operating without regulation and the large number of trustees accepting business from them without due diligence. Hammond is also ignoring the scourge of the many toxic UCIS funds being promoted to UK residents illegally, and partnered with QROPS.”
The group wants the Chancellor to work with regulators, ombudsmen and financial crime units in popular QROPS destinations to clean up the offshore industry in the interests of British expats.