Understanding the UK Pension Transfer Process

Our pensions are among the most important financial investments we make. They are there to provide a safe, comfortable, and secure retirement, allowing us to enjoy all the things we love.

For expatriates, the world of pension transfers can be complicated. There are multiple different types of schemes with varying options to retain, reinvest, restructure, or transfer pension products, each of which has pros and cons.

Chase Buchanan’s clients come to us for help managing a combination of pensions, determining the most efficient ways to maximise retirement wealth, managing the pension transfer process to a new jurisdiction, and having confidence that they have complete oversight of the costs and respective advantages of the options they may be considering.

In this guide, we’ll walk through how pension transfers work, discuss some of the primary options you may wish to consider and outline the key benefits of consulting a financial adviser to optimise your income throughout your retirement.

Pension Transfers From the UK Explained

Your pension works like any investment. You usually make payments into the scheme, often coupled with employer contributions. That pension pot is then invested or attracts interest, depending on the type of plan and the level of selected risk exposure.

The complexity for expatriates planning to transfer their pension funds is that they might have and choose multiple potential schemes and alternative products when restructuring. These include:

• Private pension plans
• Overseas pension provisions
• Auto-enrolment pensions
• Employer pension schemes
• Government pensions
• Self-Invested Personal Pensions (SIPPs)
• Recognised Overseas Pension Schemes (ROPS)

Pension transfers are a way of directing your pension fund to a different product, investment plan, or provider. This can be an excellent way of managing your retirement budget, having control over how and where it is invested, or consolidating multiple plans into one easy-to-access scheme.

However, reviewing your current pension assets, their value, and the most advantageous transfer options is essential to avoid eroding your retirement wealth or choosing a transfer route that attracts a significant tax burden.

Potential Reasons to Transfer Your Pension as a UK Expatriate

There are many different scenarios in which it may be beneficial to transfer your pension, both from a financial and a security point of view. These include:

• Consolidating multiple pension plans for better growth
• Opting for a pension provider who offers the investment potential you would like
• Reducing pension fund administration or management fees
• Choosing pension investment plans with higher returns
• Revising your risk exposure in line with your retirement plans or age
• Relocating your pension scheme to another country if you live or are moving abroad
• Making your pension tax-efficient in your country of residence
• Making your pension easier to access and manage

The key to successfully managing your pension is to work with an experienced financial adviser who will consider all the most relevant factors, such as what you want to achieve from your pension funds and how best to structure your pensions and retirement wealth around your plans.

Expatriate UK Pension Transfer Options

Most expatriates consult a wealth management consultant when transferring their pension as part of a plan to move abroad. Other clients are already expats living overseas and need to make decisions about the right ways to structure their retirement assets.

The optimal decisions will always depend on your personal circumstances, which means we’ll initially discuss some of the primary decision-making factors, such as:

1. Where you plan to live when you retire
2. What pension products you currently have, and whether there are any restrictions on changing those plans, such as exit fees
3. Your tax status, possible changes to your tax residency position and how changes to your pension scheme will impact your tax profile
4. What sort of risk exposure your investment funds have, and what level of risk you feel comfortable with
5. Your plans for the future and whether you have any intended purchases, costs or investments that will require the release of a lump sum of cash
6. When you wish to retire, or whether you are already approaching or in retirement

It is essential to work through these questions to develop a comprehensive understanding of your financial position and aspirations. This will form a baseline from which we can start developing a strategy to get the most from your pension funds in a way that works for you.

The Key Benefits of International Pension Transfers for Expats

If you live or plan to retire abroad, your pension planning is important. While we’ve summarised some of the reasons expats decide to transfer a UK-based pension fund, the primary benefits include certainty about the value of pension income without exposure to currency fluctuations.

Pension funds that remain based in the UK will sometimes permit the holder to claim benefits from overseas, but there are inherent risks that the value will change along with currency exchange rates and that each payment drawn will attract international banking fees.

Retaining a UK pension fund as an overseas expat can also complicate your tax residency status, lead to varying tax obligations linked to foreign-sourced pension incomes, and impact your long-term estate and succession planning.

Much may depend on the tax regulations in your place of residency, the value of your pension funds, and the time between seeking advice and your intended retirement date.

Overseas Pension Transfers: SIPPS vs ROPS

SIPPS, or Self-invested Personal Pensions, and ROPS, which stands for Recognised Overseas Pension Schemes, are some of the best-known choices for expat pension transfers.

A SIPP, in a nutshell, means that your financial adviser manages your retirement fund on your behalf and collects a tax rebate against the value of your funds in exchange for putting certain restrictions on your pension.

These can be tailored to your requirements and circumstances – for example, you might decide not to access your pension until you reach a certain age. In the meantime, your fund is invested according to your risk profile and will continue growing in value until you would like to start drawing down your pension.

ROPS are an alternative, and a form of international pension plan approved by HMRC and permitted to accept transfers of funds from UK pension schemes. This sort of scheme carries taxation benefits, including the potential to draw lump sums and options to save on tax liabilities by choosing to pay tax at the local rates.

However, a recent change to UK legislation means that a transfer to a ROPS, assuming a suitable scheme is available in your place of residence, may be subject to the Overseas Transfer Charge, a significant tax obligation at 25%.

Therefore, the right solutions will always depend on your circumstances, pension schemes, and your plans for the future.

Professional Pension Transfer Advice in a Changing Retirement Landscape

Pensions are personal, and one of the most meaningful forms of investment most people will make in their lifetimes.

With continually changing legislation and regulations, it is important to consult a financial adviser who understands the regulatory framework and can evaluate the pros and cons of each type of pension transfer for you.

Particularly when it comes to international pension schemes, you need to understand the tax rules, what they will mean to your revenue streams, and whether your plans will make one option more advantageous than another.

Chase Buchanan Private Wealth Management is a global provider of pensions and investment advice. We structure bespoke retirement plans to ensure every client makes informed decisions about the best way to invest for their retirement.

For access to our expertise and clear guidance about the different pension transfers – and what they could mean for your retirement – please get in touch. You can also request our Free Retirement Planning Guide to help you navigate pension transfers and retirement planning with confidence.

All investments carry risk, including the potential loss of capital. You should carefully consider whether investing is suitable for you, taking into account your personal circumstances, financial situation, and risk tolerance.

*Updated June 2025