Article Summary

Many people wonder whether a non-UK resident can establish a UK pension. SIPP for Non-UK residents offers more benefits and features. Anyone, regardless of nationality or UK tax treatment, can join or remain a member of a UK-approved pension scheme as long as the scheme rules allow. Tax relief on member contributions, on the other hand, will be available only to relevant UK individuals.

Starting a UK Personal Pension for Non-UK Residents

An overseas resident can (in theory) set up a UK personal pension plan, but there are complications.

HMRC now allows anyone from anywhere in the world to start a UK pension. However, because personal pension contracts (including SIPPs and stakeholder pensions) are between the provider and the individual, Financial Conduct Authority (FCA) selling rules require providers to be satisfied that they comply with the regulatory requirements (if any) of the specific country in which the proposed member resides. As a result, many providers or trustees will not accept pension business from non-UK residents, even if they have relevant UK earnings and thus qualify for tax relief on their contributions.

These rules apply even if an overseas resident is only setting up a new pension plan to accept a transfer from the existing UK-registered pension scheme. If the individual’s financial adviser plans to advise the member while they are overseas, they must also ensure that they meet the regulatory requirements (if any) of the specific country in which the proposed member is living.

Taxation of UK Pensions for Overseas Residents

Most pensions in the UK, regardless of how they are paid, are taxable as earned income.

However, when a pensioner moves abroad, they frequently become a non-UK taxpayer, and they may be eligible to receive their UK pension in full, without deduction from UK income tax. This also applies if the overseas resident is a pension beneficiary.

  • If a pensioner lives in a country with which the UK has a double taxation agreement. Pension income can be taxed only in the country where it is earned. Before submitting it to HMRC for approval, pensioners should complete a double taxation agreement claim form for the country in which they live and have it approved by the tax authorities in that country.
  • Claim forms are available from GOV.UK and the tax authority in the pensioner’s home country. Once HMRC approval is obtained, the pension provider can pay the pension as a gross payment without deducting UK income tax.
  • If the pensioner lives in a country with which the UK does not have a double taxation agreement, income tax will be deducted in the UK.

Can Expats Contribute to SIPP?

Non-residents of the UK are not permitted to contribute to a SIPP. However, if you were a UK tax resident in the previous five years, you should still be able to contribute up to £3,000 per year.

Because each SIPP has slightly different rules, you would need to consult your current SIPP provider to determine whether you can continue contributing to your SIPP after leaving the UK. It is recommended that you familiarise yourself with the rules before moving abroad, if at all possible.

Despite these restrictions, it is possible to open a SIPP and transfer funds from another UK personal pension scheme while you are a non-resident of the UK. However, once the SIPP is open, you may not be able to make ongoing contributions, whereas you should be able to make contributions to other existing personal pension schemes.

If you have been a non-resident of the UK for five years or more, you may want to consider transferring any existing pensions to a QROPS, which would allow you to continue contributing. Please keep in mind that QROPS will almost certainly come with additional fees and charges (such as the Overseas Transfer Fee), and you will not receive tax relief. You must seek independent advice before making any decisions about transferring any pension funds.

What Happens to My UK SIPP if I Move Abroad?

In general, you cannot continue to contribute to your UK SIPP if you no longer reside in the UK. Furthermore, there is no compelling reason to do so.

The primary reason for contributing to a pension is to receive tax relief on funds invested. This is no longer applicable depending on how long you have been abroad (some SIPPs may allow tax relief on minimal contributions). Not only that, but some SIPPs will not accept any contributions at all.

Can I Pay Into a UK Personal Pension if I Live Abroad?

If you live abroad, you may be able to contribute to a UK pension, but check with your pension provider about the rules for the scheme you’re enrolled in. Even if you are able to contribute to a UK pension while living abroad, you may not be eligible for tax relief on your contributions.

Advantages of International SIPP for Non UK Residents

The International SIPP is an appropriate pension vehicle for those planning to retire abroad. This type of SIPP gives you more control over where your pension money is invested because you have access to a much broader range of product offerings. Key characteristics include:

  • Flexible Access – You can access your pension pot as early as age 55. This can be a regular or sporadic source of income.
  • Management – Allow a regulated independent financial adviser in your jurisdiction to implement an ongoing strategy.
  • Tax Relief – Because the SIPP is based in the UK, it is still eligible for tax relief if you return to the UK.
  • Extensive Investment Options – Invest in a wide range of assets, including direct FTSE 100 company shares, commercial real estate, government securities, mutual funds, and exchange-traded funds (ETFs).
  • Multi-Currency – Investing and withdrawing in all major currencies reduces currency risk. Furthermore, currency conversion can be performed entirely within the SIPP.
  • Low Cost – Starting at £0 for setup and as low as £180 per year. Up to 7 times less expensive than a QROPS
  • Safety and Protection – Maintains the Financial Conduct Authority’s and the Financial Services Compensation Scheme’s stringent regulation.
  • UK Compliant – The SIPP is fully UK compliant because it is held in the UK and regulated by the FCA. As a result, there is no need to make any changes if returning to the UK.
  • Portability – You can exit the SIPP if your circumstances change and a different product becomes more appropriate.
  • Consolidation – Combine two or more pension pots to implement a single strategy while lowering overall costs.
  • Receive payments net of UK tax – Using an NT code and depending on the status of dual tax treaties, you can receive your pension payments net of UK tax.

Cameron James, Expat Financial Planning – Your Trustworthy Pension Transfer Specialist

Cameron James Expat Financial Planning is the preferred independent financial adviser for final salary pension and SIPP transfers. With over ten years of experience transferring pensions, Cameron James is now servicing clients in 26 countries. 

We have the qualifications and technical knowledge required to help you transfer to an international SIPP as an expat and a US resident. Our mission is to bring regulated and transparent advice to our clients. As such, our clients know how much their advice will cost in advance, with no hidden fees.

Cameron James Expat Financial Planning has a sophisticated cash flow management system in place. Our senior management team has a decade of experience in serving expats and is committed to serving the requirements of expats for decades to come.

Transferring a DB or DC pension into a SIPP plan for expats is not a simple decision. Before deciding, many details and procedures must be thoroughly understood. Without this knowledge, the benefit will turn into a potential loss.

It is important to seek competent advice from a qualified financial adviser to verify that your profile matches the suitable options and to ensure that your choice meets the UK and US regulations. Meet one of our dedicated IFAs to get a full understanding of SIPP for Non-UK Residents.


Our Founder & CEO -
Dominic James Murray

I have been in the UK Pension Transfer industry for over 11 years, and have witnessed seismic changes in the UK Pension rules over the course of that decade. Most to the benefit of the UK Chancellor or to Chequer!

My 5 years as CEO of Cameron James, have certainly been the most rewarding. My goal, has been a simple one. Provide clients with transparent financial advice on a low-cost basis, for them to make informed decisions to protect their families best interests.


Our Clients Love Working With Us!

We have worked hard for our reputation and we will be maintaining it.