Can I transfer my Irish pension to the UK?

Some Irish pension products are simply not suitable for non-domiciled individuals or those that do not intend to stay in the country in later life.

However, navigating the complexities of pension transfer between countries can be daunting, especially when dealing with two different regulatory environments such as Ireland and the UK.

This guide aims to simplify the process, outlining key considerations, steps, and implications of transferring an Irish pension to the UK.

Can I Transfer My Irish Pension to the UK?

Before considering a transfer, it’s essential to understand that not all pension schemes can (or should be) moved.

If you are able to transfer your scheme, any decision to do so should be based on your individual circumstances, including tax implications, benefits retention, and long-term financial goals.

When should you consider transferring an Irish pension?

You are no longer living in Ireland.
You wish to have more control and flexibility when drawing your pension benefits.
You also have UK pension benefits and wish to consolidate these with your Irish pension.
You wish to avoid situations where you are double taxed on your pension benefits.

UK Pensions Versus Irish Pensions

UK SIPPs differ from Irish pensions in 4 key ways.

1. Easier to manage when you live abroad

UK SIPPs are far less complex to manage when you live abroad, and can allow you more flexibility in the currency that you draw your money.

2. No Irish Taxes

Ireland retains the taxing rights on withdrawals from some Irish pension products which can lead to double taxation, i.e. a tax liability in Ireland and also a tax liability in the country of residence.

While SIPP income payments are accessible to UK income tax at source, if you live in a jurisdiction with a UK Double Taxation Agreement (DTA), you can request a ‘No Tax Code’ from HMRC.

3. Flexibility with withdrawals

Withdrawing money from your Irish pension can be complex and inflexible, with a whole host of complicated rules.

On the other hand, UK pension products have no annuity requirements, and you can withdraw money as and when you wish.

4. Death benefits are simpler

Irish pensions come with high inheritance taxes and complicated rules for spouses and children, making local tax advice essential.

UK pension products offer far more streamlined succession planning, detailed below.

Transferring an Irish pension to a SIPP: Step-by-Step Process

✔️ Assess Eligibility and Impact

Consult a financial advisor to understand the feasibility and impact of the transfer.

This includes assessing the benefits you might lose and any charges or taxes that may apply.

✔️ Choose a Suitable UK Pension Scheme

Not all UK pension schemes accept transfers from Irish pensions.

In addition, not all UK pensions allow flexible access to your pension benefits.

✔️ Request a Transfer Value

Contact your Irish pension provider to request a statement of your transfer value and any charges that may apply.

✔️ Complete Due Diligence

Both your Irish pension provider and the UK scheme will perform due diligence to ensure the transfer complies with regulatory requirements.

✔️ Approval and Transfer

Once due diligence is completed and both parties agree, the funds are transferred to the UK pension scheme.

Considerations and Implications

💡 Tax Implications

Understand both the immediate tax implications of the transfer and how it will affect your pension income tax in retirement.

💡 Benefits and Guarantees

Analyse what benefits, if any, you may lose from the Irish scheme, such as guaranteed annuity rates or defined benefits.

💡 Exchange Rate Risk

The transfer value could be affected by fluctuations in the exchange rate between the Euro and British Pound.

To minimise this, or if you are retiring in the Eurozone, you may want to choose a SIPP that allows you to hold your pension funds in Euro.

💡 Regulatory Changes

Stay informed about any regulatory changes in both Ireland and the UK that could affect your pension in the future.

The Bottom Line

While some Irish pension products are simply not suitable for those who do not intend to stay in the country in later life, transferring an Irish pension to the UK is not a decision to be taken lightly.

It requires thorough consideration of the financial, regulatory, and personal implications.

Consulting with someone who is an expert in this field is crucial to navigate this complex process successfully.

By understanding the steps involved and carefully evaluating the impact on your retirement planning, you can make an informed decision that aligns with your long-term financial goals.

Get In Touch

If you have an Irish pension and are wondering what your best options are, please get in touch for a free no-obligation 20-minute call.

I would be happy to review your position, explain where you stand and show you what you need to do to make the most of your retirement savings.