When the new rules regarding the UK pension age 55 years test came into force on 6 April 2015, all Australian superannuation funds were removed from the recognised overseas pension scheme (ROPS) list.
Broadly speaking, this precluded UK pension transfers to all Australian superannuation funds apart from one public sector fund.
The addition of P Wyns Age 55 Super Fund to the ROPS list on 1 September 2015 demonstrated that a newly established SMSF could satisfy the new QROPS rules where the fund’s membership was restricted to persons who were already 55 years or over, DBA Lawyers director Daniel Butler told SMSF Adviser.
“We can now confirm that an existing SMSF (i.e an SMSF that has merely had its deed updated with a special restricted deed of variation) where membership is restricted to those who have attained 55 years or over can also now satisfy the new QROPS rules,” Mr Butler said.
“Such an SMSF was added to the ROPS list on 15 September 2015,” he added.
DBA Lawyers assisted this SMSF in becoming QROPS-compliant.
“Broadly, the new UK rules prohibit superannuation funds paying any benefit to a member under 55 years unless it is in accordance with the UK’s definition of ‘ill-health’, which is similar but stricter than our definition of ‘permanent incapacity’ in regulation 1.03C of the Superannuation Industry (Supervision) Regulations 1994 (Cth),” Mr Butler said.
“We are also continuing to seek Her Majesty’s Revenue & Customs (HMRC) approval regarding the ability for SMSFs with members who are under age 55 once we obtain HRMC approval. At this stage, however, we have no certainty on this submission.”
There are now two more SMSFs on the list.
Guidance I’ve received to date from HMRC confirms that they are only allowing funds on the list who restrict the membership to members over age 55, which is not very helpful for anyone who is under 55 and wants to bring their benefits across.
However, there are some other alternatives that we are exploring.