HMRC's QROPS rules set the tests an overseas scheme must meet, a 25% charge on some transfers, a period of five-plus years after it, and reporting duties.
Put simply, HMRC's QROPS rules decide whether an overseas scheme can take a UK pension transfer without an unauthorised payment charge, whether that transfer is taxed at 25%, what a later move of country can change, and what the scheme must report. Where your own residence, scheme or pension type is involved, this page's short form sets up a free chat with an FCA-authorised adviser.
What are HMRC's QROPS rules?
They sit in Part 4 of the Finance Act 2004 and regulations made under it, and HMRC's Pensions Tax Manual explains them. There are four parts:
- The scheme conditions. The receiving scheme must be a QROPS: an overseas scheme that meets the ROPS conditions below, and whose manager has notified HMRC and given the undertakings in section 169(2) of the Act, including one to operate the overseas transfer charge. How the two labels differ is on QROPS vs ROPS.
- The overseas transfer charge. Income tax of 25% on a transfer unless an exclusion applies, and on any excess over the overseas transfer allowance even when one does.
- The five-year rule. For the rest of the tax year of the transfer plus five more, moving country can make an exempt transfer chargeable, or bring a refund.
- Reporting. The scheme manager reports payments, changes and its continuing status to HMRC, with a narrow exemption after 10 years.
Getting the first part wrong is the costliest mistake. A transfer to a scheme that is not a QROPS is an unauthorised payment, leaving the member liable to tax of at least 40%, and the manual says members cannot rely on scheme administrators to carry out the checks for them. Neither a QROPS reference number nor a place on HMRC's published list proves the status; checking HMRC's list explains what the list does show. QROPS status also matters only for UK tax: whether the scheme can accept the money depends on its own country's law.
QROPS conditions: the tests a scheme must meet
Whether a scheme meets these is a matter of fact about the scheme, not paperwork, and they must be met at all times:
- Regulation. Where its country has a regulator for its type of scheme, the scheme must be regulated by it, with no opting out. Where a country has no regulator for non-occupational schemes, the provider's financial services regulator can serve.
- Tax recognition. The scheme must be open to residents of its own country and registered with the tax authority there as a pension scheme. The country must tax personal income and give tax relief specifically for pension savings.
- Benefits tax relief. Where tax relief on benefits is available to non-residents, the same or substantially the same relief must be available to residents.
- Pension age. Apart from named lump sums, a member under 55 (57 from 6 April 2028) can be paid only on ill-health retirement. HMRC calls this "an ongoing test".
- Treaty link. The country needs a double taxation agreement with the UK providing for exchange of information, or a tax information exchange agreement.
Overseas public service schemes and schemes set up by an international organisation do not have to meet the benefits tax relief or pension age tests, and an international organisation "does not include multinational companies". Whether a named scheme passes everything depends on its own documents, and an adviser reached through the form here can say what to ask the scheme for.
The overseas transfer charge: when 25% applies
The overseas transfer charge is a 25% income tax charge on some transfers to a QROPS. From the 2024-25 tax year, sections 244AA to 244AC of the Finance Act 2004 replaced the old section 244A, and section 244AC says:
"The overseas transfer charge arises where— (a) a transfer within subsection (2) is made to a QROPS, and (b) the transfer is not excluded from the charge by or under any of sections 244B to 244H."
— Finance Act 2004 s244AC, legislation.gov.uk, accessed 21 October 2026
Section 244JA sets 25% for both routes to a charge:
| Section | When it applies | What is charged |
|---|---|---|
| 244AC | No exclusion applies | 25% of the transferred value (a different base applies to some onward transfers) |
| 244IA | An exclusion applies but the transfer exceeds the available overseas transfer allowance | 25% of the excess |
For transfers requested on or after 30 October 2024 the manual lists four exclusions: the member lives in the QROPS's country; the QROPS was set up by an international organisation and the member is its employee; the QROPS is an overseas public service scheme and the member works for a participating employer; or the QROPS is an occupational scheme and the member is employed by a sponsoring employer. Residence means tax residence. An exclusion works only if the member gave the scheme administrator the required information beforehand: GOV.UK says form APSS 263 sets this out, and the transfer "will be taxed at 25% if you do not provide all the information the form asks for within 60 days of requesting the transfer". The member and the scheme administrator are jointly and severally liable for the charge.
The overseas transfer allowance
Section 244IB makes the overseas transfer allowance equal to the member's lump sum and death benefit allowance. GOV.UK's rates page lists the standard figure as £1,073,100 for 2025 to 2026 and 2026 to 2027, and it may be higher with a protected allowance. Earlier transfers to a QROPS reduce it, and on a first transfer on or after 6 April 2024 HMRC also deducts 100% of the lifetime allowance used before that date. What is left of your allowance depends on your pension history; if you may be close to it, the enquiry form lets you ask an adviser to work through it with you.
What changed on 30 October 2024
A fifth exclusion used to cover a QROPS in the EEA or Gibraltar with a member living in the UK or EEA. GOV.UK's policy paper records that "At Autumn Budget 2024, the Government announced that they would remove the exclusion". Section 32 of the Finance Act 2025 then omitted section 244C for transfers made on or after 30 October 2024. It survives for a transfer made "in execution of a request made before 30 October 2024" and completed before 30 April 2025. Section 33 of the same Act, in force from 6 April 2025, amended the 2006 regulations that set the scheme conditions, rewriting the regulation test and removing EU member states, Iceland, Liechtenstein and Norway from the countries that met the location test without an information-exchange agreement; HMRC's policy paper describes this as bringing EEA schemes "in line" with those in the rest of the world. See which countries have QROPS.
The QROPS five-year rule: two different five-year periods
The first is the "relevant period" after a transfer. It is not simply five years: for a transfer on any date but 6 April it is "the period from that date until the next 5 April plus a further five years from the next 6 April". HMRC's example is a transfer on 13 June 2017, with the period running to 5 April 2023. If a member excluded because they lived in the QROPS's country moves away within it, the charge is treated as arising then (s244B). GOV.UK says to fill in form APSS 241 and give it to the scheme administrator, with a refund possible if you moved to the QROPS's country and 25% tax if you moved away. The manual sets 60 days for telling them.
The second is the scheme's own duty to tell HMRC every five years that it is still a ROPS. GOV.UK says HMRC "will remove the scheme’s QROPS status if you do not re-notify them". How a move on your dates would play out is something an adviser can explain free if you leave your number in the form below.
QROPS reporting: is there a 10-year rule?
There is a 10-year point in the reporting rules, but a narrow one: no payment report is needed where the member payment provisions no longer apply and the payment "is made more than 10 years after" the transfer that created the fund (or, for ring-fenced transfer funds, their latest key date). Otherwise the manager must report payments to HMRC within 90 days, on forms such as APSS253. If a member changes address during the relevant period to somewhere outside the scheme's country, the manager has three months from learning of it to tell HMRC. It must report changes to its information, or ceasing to be a QROPS, within 30 days. Failure lets HMRC exclude the scheme, and the tax charges "continue to apply if a scheme stops being a QROPS".
Before any QROPS transfer: advice and scam checks
The FCA lists among the warning signs of pension scams "Several groups (some of which may be based overseas) all taking a fee", and says that if you are contacted unexpectedly and offered a free pension review, "it’s likely to be a scam". See pension scams. The FCA and The Pensions Regulator "believe it’s in most people’s best interests to keep their DB pension", and under regulation 5 of SI 2015/742 advice is required before transferring safeguarded benefits with a transfer value above £30,000 (legislation.gov.uk). See the advice requirement, final salary pensions and finding a transfer specialist.
Questions about HMRC's QROPS rules
Is QROPS still available?
Yes. HMRC still publishes its notification list twice a month, and GOV.UK still describes transfers to a QROPS. What has changed is the charge and its exclusions, above.
What rule changes have affected QROPS?
Transfers requested before 9 March 2017 are not subject to the charge; the 2024-25 sections replaced section 244A; the EEA and Gibraltar exclusion ended for transfers from 30 October 2024; and from 6 April 2028 scheme rules should reflect a minimum payment age of 57.
How does a scheme become a QROPS?
Its manager tells HMRC that it meets the ROPS conditions, using form APSS251, and gives the undertakings described above. To keep the status it must go on meeting the conditions and re-notify HMRC every five years.
Does an EEA or Gibraltar QROPS still avoid the 25% charge?
Not on location alone. The residence and employer-based exclusions above still apply. See which countries have QROPS.
Do the QROPS rules still apply if I come back to live in the UK?
Some do. HMRC's manual says any pension paid from a QROPS is taxable while you are UK resident, and the tax charges carry on even if the scheme stops being a QROPS. Moving the money itself back is covered in transferring a QROPS back to the UK, and a different overseas status in QROPS vs QNUPS.
Your next step
Whether the 25% charge applies depends on where you live, the scheme and your pension history. Ask for a call-back through the form below and the adviser who rings, from an FCA-authorised firm, looks at your position at no cost. Other routes remain open, including asking your pension scheme, and abroad you will need advice in the country where you live too. For the process see how to transfer a pension and transferring to a QROPS.