Moving or retiring abroad - what happens to my Fidelity SIPP?

Q: I have a Fidelity Self-invested Personal Pension (SIPP).  I may become a tax resident in another country. Where can I find the implications to consider?

A: Great question and it’s one we get asked a lot. As I’m not 100% clear as to whether this means you’re planning on moving overseas - for the time being - or retiring overseas permanently, here’s a list of the most common questions we get asked on the topic and some other useful information. Hope it helps.

1. Can I transfer my SIPP overseas?

Yes, you can transfer your SIPP to a Qualifying Recognised Overseas Pension Scheme (QROPS), as long as the receiving scheme agrees to accept the transfer. It’s best to check this with them directly before starting.

We can only transfer the money in sterling, and in some cases, you might need to pay a 25% tax charge. To begin the transfer, you’ll need to contact the scheme you're transferring to – they’ll explain the next steps and give you the forms you’ll need.

2. What is a Qualifying Recognised Overseas Pension (QROPS)?

If you plan to stay abroad long-term, you might consider moving your SIPP into a Qualifying Recognised Overseas Pension Scheme (QROPS) if you plan to stay abroad long-term. Here’s some things you need to be aware of: 

• Overseas transfer allowance: You can transfer up to £1,073,100 without incurring extra tax. Anything above that may be taxed at 25%.
• Non-QROPS transfers: Transferring to a scheme that isn’t on HMRC’s recognised list could trigger a 40% ‘unauthorised payment’ charge, or your provider may simply refuse the transfer.
• Check the list: Always verify the scheme remains on HMRC’s recognised list (the ‘ROPS notification list’) before you transfer.

3. If I move overseas, can I still access my Fidelity SIPP?

If you move overseas, you won’t be able to pay into your SIPP anymore. However, you’ll still be able to take money out or transfer your SIPP to another provider. Any withdrawals can only be paid into a UK bank account.

Your tax-free cash will be measured against your Lump Sum Allowance (LSA) and Lump Sum and Death Benefit Allowance (LSDBA). You won’t pay any extra UK tax, but there may be tax to pay in the country you move to.

• Read: What is the lump sum allowance?

4. Are there restrictions applied to my account if I move overseas?

Yes, there are some changes. You won’t be able to buy new investments – only sell or withdraw money from your account. If you hold any US shares, these will be sold and the cash will remain in your account. Some of the tools and features on our website might also be limited.

That said, you’ll still be able to see your full portfolio, and if you want to make a trade, just get in touch with us and we’ll help.

5. How do I update my address to an overseas one?

You can change your address by logging in to your online account. From the ‘My account’ section, go to the ‘Account Summary’ page, then select ‘Profiles’ at the top and choose ‘Personal information’.

If you prefer, you can also fill out our change of address form. You’ll find it with our general forms here.

6. Can I still receive payments from my Fidelity SIPP abroad?

You can continue to have pension payments sent to your UK bank account and convert them locally, or your provider may be able to pay directly into an overseas account. Bear in mind:

• Exchange rates and fees: Converting British Pound Sterling (GBP) to the local currency can eat into your income.
• Provider charges: Not every pension firm supports overseas payments - those that do may charge you extra fees.

Understand more about tax rules and pensions

• Let HMRC know where you live and pay tax
  As soon as you become resident in another country, you must inform HMRC. Where you pay tax on any pension withdrawals will depend on the UK’s double-taxation agreement (DTA) with your new home country. If there’s a DTA in place, it usually sets out which country has ‘primary taxing rights,’ so you won’t be taxed twice on the same income.
   
• Local tax rules on pensions
  Every country treats foreign pension income differently - some tax lump sums, others tax only the income, and a few may exempt it entirely. You’ll need to:
   
• Review the DTA for your new country (search ‘Double Taxation Agreement’ on gov.uk or in the HMRC International Manual).
   
• Check if your SIPP withdrawals count as ‘income’ or ‘lump sums’ under local law (this can change how much tax you pay).
   
• Read: For more information about overseas pensions and pension transfer see gov.uk

Leave no stone unturned

Before making such a big life-changing decisions you really need to think about your own situation and future needs. I’m neither a tax specialist nor a financial adviser. It’s important that you take three steps before leaving the UK:

1. Do your research - make sure you understand the rules of each pension plan you have money invested in. You can track down any previous personal or workplace pensions using the government’s free Pension Tracing Service.
2. Consider taking advice - finding the best solution for your individual needs can be complex, particularly if you have built up different types of UK pension savings and/or have pension savings outside the UK. Talking to a tax specialist or financial adviser might give you peace of mind. 
3. Contact all your pension providers - whether you’ve made a decision to take your pension benefits or make a transfer, get in touch sooner rather than later as an overseas transfer can take up to six months.

The Government’s Pension Wise service offers free, impartial guidance to help you understand your options at retirement. You can access the guidance online at www.moneyhelper.org.uk or over the telephone on 0800 138 3944.

Fidelity’s Retirement Service also has a team of specialists who can provide you with free guidance to help you with your decisions. They can also provide advice and help you select products though this will have a charge.

If you’ve got a burning question you want to ask, why not drop us a line? Ask us your question

Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. Tax treatment depends on individual circumstances and all tax rules may change in the future. Withdrawals from a pension product will not be possible until you reach age 55 (57 from 2028). It’s important to understand that pension transfers are a complex area and may not be suitable for everyone. Before going ahead with a pension transfer, we strongly recommend that you undertake a full comparison of the benefits, charges and features offered. To find out what else you should consider before transferring, please read our transfer factsheet. If you are in any doubt whether or not a pension transfer is suitable for your circumstances we strongly recommend that you seek advice from one of Fidelity’s advisers or an authorised financial adviser of your choice. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.