QROPS vs International SIPP 2026 | Which is Best For British Expats Now?
For British expats, deciding what to do with a UK pension after moving overseas is a big task. While starting a new life abroad can be the start of an exciting new adventure, it requires thorough financial planning and many expats seek tax-efficient, flexible ways to manage their retirement savings overseas.
When transferring your pension to an international solution, the rules can be complex, tax outcomes may depend heavily on where you live, and selecting the wrong structure can slowly erode your retirement wealth over time.
The two most common non-UK pension schemes used by expats are QROPS (Qualifying Recognised Overseas Pension Schemes) and International SIPPs (Self-Invested Personal Pension). Both are legitimate, HMRC-recognised routes for managing UK pension savings outside of the UK, yet they serve very different needs. Understanding how they compare is essential before making any decisions.
A QROPS is an overseas pension scheme which meets HMRC requirements and allows UK pensions to be transferred abroad. These schemes were originally designed to support individuals who have permanently left the UK and want their retirement savings aligned with their new home country.
An International SIPP by contrast, is a pension which remains UK-registered but is designed for non-UK residents, offering broader investment choice and international flexibility while staying within the UK pension framework. Although on the surface these two pension solutions may appear similar, they function very differently in practice.
QROPS Vs SIPP 2026
From a tax perspective, both structures offer advantages for UK expats. QROPS can be attractive for expats who have been non-UK residents for a sustained period and intend to remain so. Once certain conditions are met, pension benefits may be paid without UK income tax, subject instead to local tax rules.
However, legislative changes in recent years, including updates announced in the 2024 Labour budget, have nullified some of the historical tax advantages of QROPS and significantly narrowed down the circumstances in which they can be used.
While International SIPPs remain subject to UK pension rules, UK tax is often reduced or eliminated through tax treaties, meaning income may be taxed in your new country of residence rather than the UK.
A significant differentiator of these two structures is their flexibility. International SIPPs are widely regarded as more adaptable and therefore suited to globally mobile expats. They typically allow contributions, transfers, and withdrawals to be managed across borders with fewer restrictions, and multi-currency options. QROPS, while flexible in certain jurisdictions, can impose tighter rules around benefit access, retirement ages, and permitted structures depending on where the scheme is based. For expats who may move in the future, this rigidity can become a limitation.
Costs may vary greatly between the two structures. QROPS often involve higher set-up fees and ongoing trustee and administration charges, particularly in offshore jurisdictions. International SIPPs tend to be more cost-effective over the long-term, especially when held on modern platforms with transparent fee structures. While costs may not be the sole driver of your decision, they can impact the value of your pension pot over time.
Control is another area where International SIPPs stand out. They usually offer a wide investment choice, including equities, funds, ETFs and bonds, often across multiple currencies. QROPS investment choice depends heavily on the scheme and the jurisdiction in which they are based, and some are restricted to insured or trustee-approved solutions. For experienced investors or those working closely with advisers, this difference in control may be a deciding factor.
Jurisdiction Considerations
When determining whether a QROPS or an International SIPP is best for you, the jurisdiction you live in will play a central role. A QROPS must be established in an HMRC-recognised jurisdiction, and the list of approved locations has reduced significantly over time.
A key change in recent years is that the Overseas Transfer Charge now applies to any pensions transferred to a QROPS which is not based in the same jurisdiction in which you are resident. This charge is a staggering 25%, which means losing a quarter of your pension pot. Most QROPS are based in Malta and Gibraltar, with a few more options which can be found on HMRCs official list here For this reason, a QROPS may not be an option unless you reside in one of these countries.
International SIPPs remain within the UK regulatory framework and benefit from the stability of UK pension law. This can be reassuring for expats concerned about sudden rule changes overseas. However, local tax treatment will vary depending on your country of residence, and seeking advice is essential to ensure you remain locally compliant. For those living in countries with favourable pension taxation, such as the UAE, the combination of a UK-based structure and local tax neutrality can be particularly advantageous.
Which International Pension Solution Is Best For You?
QROPS are generally better suited to expats who have permanently left the UK, have no intention of returning, and live in a jurisdiction where a local QROPS offers clear tax or estate planning benefits. They may also appeal to those seeking to remove their pension entirely from the UK system, particularly if they are concerned about future UK policy changes. However, this suitability is highly individual and increasingly dependent on careful jurisdiction selection.
International SIPPs are suitable for expats who value flexibility, transparency, and investment choice and control. They are often favoured by internationally mobile professionals, business owners and high net worth individuals who want their pension to adapt as their life evolves. They can also be more appropriate for those who expect to return to the UK one day or who want access to a wide range of global investments without being tied to a single offshore regime.
The Wealth Genesis | QROPS
The Wealth Genesis | International SIPP
An Example
Consider a former UK contractor who has relocated to Dubai and established long-term residence there. With no personal income tax in the UAE and a globally diversified investment strategy, this individual is seeking a pension solution which offers flexibility and multi-currency investment options.
While a QROPS could offer local tax efficiency, the contractor is concerned about limited investment choice, higher fixed costs and the possibility of the 25% Overseas Transfer Charge if no scheme is based or recognised in the UAE.
An International SIPP, by contrast, allows them to retain full control over asset allocation, invest in sterling, dollars, and other currencies, and benefit from the favourable tax environment in the UAE without unnecessary complications. In this scenario, an International SIPP is more aligned with the financial goals of the contractor.
Our Verdict
When deciding between a QROPS and an International SIPP in 2026, the key considerations are balancing control, flexibility, tax relief and long-term stability against jurisdictional complexity and cost. Each structure serves a distinct purpose for British expats, and each can be highly effective when aligned with the right financial goals and circumstances.
As UK pension and tax laws continue to evolve, making the right choice is rarely straightforward, but working with a specialised adviser can ensure your pension strategy is structured correctly. At The Wealth Genesis, we support expats globally through the pension transfer process. The right guidance and retirement planning can help protect your wealth, take advantage of tax benefits, and ensure your pension funds support your new life abroad. To learn more, book a free discovery call today.
QROPS Vs International SIPP: Your Decision Checklist
For UK expats who want to retire abroad, it is key to focus on the bigger picture when choosing between a QROPS and an International SIPP, rather than seeking one feature in isolation. With our decision checklist, you can assess which solution is aligned with your wider financial goals and personal circumstances and gain clarity on your objectives when working with your adviser.
When reviewing your options, consider the following:
Your current country of residence and tax residency and how foreign pension income, lump sums, and death benefits are taxed locally or under a double taxation agreement.
How defined your long-term plans are, whether you are settled in your country of residence or expect to relocate again before or during retirement.
Whether you want to fully remove your pension from the UK system, or whether retaining the stability and familiarity of UK regulation is important to you.
The degree of investment control you require, including access to global markets, varied investment choices, and multi-currency options.
The full lifetime cost of each pension structure, factoring in setup fees, platform charges, advisory costs, and underlying investment fees.
Your intended retirement age and how easily you can access and manage your pension benefits to meet your changing retirement income needs.
Your estate planning objectives, including how your pension assets will be treated in the event of death and how benefits will be passed to your beneficiaries. Will UK inheritance tax or local succession laws apply?
If you feel uncertain about any of these points, it would be wise to consult a qualified financial adviser before proceeding. To schedule an initial consultation with a member of our team, use the diary below.
