Last Updated on 13th January 2026
Pension transfers are one of the many complex areas of financial management expats need to consider when moving abroad – and there are numerous potential fund structures, tax obligations and product types that an individual might want to compare.
Rather than having just one or two options, the right decisions should always be based on professional, independent advice from a wealth manager who understands the pension tax frameworks in both your country of origin and your new place of residency.
To add clarity to how decision-making around cross-border pension transfers works, we’ve created this guide to show each step, illustrating why there isn’t one pension transfer pathway, but rather a consultative process to ensure you make informed, strategic decisions.
Reviewing Your Current Pensions
Before any current or prospective expat decides how to manage their pension wealth, we strongly advise them to undergo a tailored portfolio review. This will ensure they understand the value of their current pensions and the terms of each fund that dictate their ability to transfer or reinvest their retirement savings.
There are, of course, many different types of pension you might hold. They include workplace, private, and government pensions, which may be annuities, defined-benefit, or defined-contribution funds.
Calculating the total value, assessing your access to lump-sum drawdowns, and understanding any limitations on how your pension schemes can be managed are key.
In addition to verifying whether you have the right to transfer your pension and whether there are administrative costs linked with this, you’ll also need to confirm whether the value of your funds exceeds £30,000.
If so, and if they are held in a defined benefit scheme, you must seek advice from an FCA-regulated firm before those funds can be moved due to the regulatory rules in place.
Forecasting Necessary Retirement Wealth
Next, we’d suggest looking ahead to retirement, whether you’re relocating to enjoy a relaxed pace of life now or will be working or running a business for several years. The point at which expats make important decisions about their pension wealth is often a good time to consider additional products or restructuring if there is a risk that their current pension wealth won’t be adequate.
This involves forecasting the value receivable at retirement based on fund performance and returs, evaluating how interest or returns are calculated, and assessing the level of risk associated with each retirement investment.
As an illustration, a pension fund may be of a reasonable value but also be risk-averse, which means there is a forecast gap in your retirement wealth.
In this scenario, you might consider reinvesting funds in a higher-risk, higher-return alternative, or setting up new pension funds, schemes or investments to ensure you aren’t likely to face a shortfall when the time comes.
Setting Priorities and Objectives
The third and final stage in consulting with an expat client on pension transfers is to establish what matters most to you. This will directly influence the types of transfers we might suggest and how your retirement wealth should best be managed. That means considering:
- How long you have until your intended retirement
- Your eligibility for the UK State Pension and other benefits
- The tax exposure associated with your existing pension
- Your wishes in terms of estate and succession planning
- How comfortable you are assuming risk
Some expats approaching retirement may be focused on managing tax exposure and protecting the value of their pensions. In contrast, others might be looking for ambitious retirement investments that capitalise on longer time horizons, which is why there is never one pension transfer strategy that is relevant to everyone.
Assessing Pension Fund Structures
Once we’ve completed the initial groundwork, we’ll be in a great position to advise on the types of pension funds that align with your expectations, reviewing the risks and limitations of each.
There might be options to leave pensions as-is within the UK, to transfer funds to a Recognised Overseas Pension Scheme (ROPS), to reinvest funds into a Self-Invested Pension Plan (SIPP), or to invest in an entirely different product.
This phase is detailed because it is essential that every expat knows how each scheme works. They also need to understand how their money will be invested, the level of control they will have, the costs associated with transferring and managing schemes, and whether they’ll have the freedom to adjust the underlying assets linked to their pension in the future.
Evaluating Tax Exposure on Pension Transfers
Pension transfers are not without cost, and following UK tax reforms, some transfers may incur the Overseas Transfer Charge (OTC). This tax applies to pensions transferred outside of the UK that are worth £1.073 million or more.
There are exemptions, such as when the scheme holder lives in the same country as a ROPS, but this isn’t common. Given that the charge is 25% on anything above the threshold, it may be a significant factor.
Alternatives such as SIPPs enable expats to retain pension funds within the UK without any transfer tax, but this also can carry risks linked to exposure to future inheritance tax, which is why customised guidance is essential to ensure you select the products and transfer methods most appropriate to you.
Verifying Ongoing Tax Liabilities on Pension Benefits
Importantly, pension transfer taxation is not the only tax you’ll pay, and depending on where you plan to live, you’ll need to budget for income tax against regular benefits, and sometimes taxation against lump sum drawdowns.
Working through this in detail helps expats avoid unexpectedly high tax bills in the future and ensures each client decides on the right way forward, minimising immediately payable tax and preserving the value of their pension assets for retirement.
Independent Guidance Around International Pension Transfers
As we’ve seen, pension transfers are far from straightforward, and you may be required to seek independent advice to ensure your fund holder is permitted to process a requested transfer in accordance with FCA regulations.
Should you require more information about international pension transfers, you are welcome to contact the nearest Chase Buchanan Private Wealth Management office to arrange a good time to talk with one of our experienced advisers, and you can also download our free Retirement Planning guide.
© Chase Buchanan Private Wealth Management.
Chase Buchanan Ltd is authorised and regulated by the Cyprus Securities and Exchange Commission with CIF Licence 287/15 and offers its services in the EU on a cross-border basis as per the provisions of MiFID.
Chase Buchanan Insurance Services, Agents & Advisors is authorised and regulated by the Cyprus Insurance Companies Control Service with License No 6883 and offers services in the EU on a cross-border basis as per the provisions of the Insurance Distribution Directive (IDD).
Investing in financial instruments involves risk and may not be suitable for all investors. The value of investments may go up as well as down and past performance is not a reliable indicator of future results. You may lose part or all of your invested capital.
*Information correct as at January 2026
