UK-IoM Pension Transfer Rights Relaxed Under New Rules

by Amanda Banks, Tax-News.com, London

28 February 2006

Pension rights transfers from the UK to the Isle of Man will no longer be subject to HM Revenue and Customs (HMRC) discretion, and individuals will not have to meet any HMRC conditions under simplified pension laws to be introduced in the UK on April 6.

It is believed by HMRC that the new rules will make it easier to make transfers than the existing bilateral arrangements.

As a result, the existing reciprocal agreement between HMRC and the Manx tax authorities for the transfer of pension rights will be terminated with effect from 5th April 2006, according to Malcolm Couch, the Isle of Man's Assessor of Income Tax.

This will also apply to HMRC’s reciprocal transfer arrangements with the Republic of Ireland, Jersey and Guernsey from that date.

Mr Couch explained that the ability of an Isle of Man resident moving to the UK on changing their job after 5th April 2006 to transfer their pension back to the UK will remain but it will take place under the new regime.

Guidance on the new arrangements has been posted on HMRC's website.

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