5 Advantages of Transferring a UK Pension Scheme to Canada QROPS (2024)

Key Points

Strata Wealth specializes in transferring UK pension schemes to Canada

There are many advantages to transferring a UK pension to Canada

You must be age 55 or older to qualify for a transfer of pension funds

You can simplify your retirement income by having your pension in Canada

For many UK expatriates living in Canada, managing their UK-based pension can be a challenge. One effective solution is transferring their UK pension to a Canadian scheme through a Qualifying Recognised Overseas Pension Scheme (QROPS). This method has become increasingly popular due to the significant benefits it offers. At Strata Wealth, we specialize in helping UK expatriates transfer their pension schemes from the UK to Canada.

In this blog post, we will explore five advantages of transferring a UK pension scheme to Canada via QROPS.

1. Tax Efficiency

One of the most compelling reasons to transfer a UK pension to a Canadian QROPS is the potential for improved tax efficiency. UK pensions are generally subject to UK taxes, and any withdrawals could be taxed in the UK. However, with a QROPS transfer, the pension can be taxed according to Canadian tax laws, which can be more favorable depending on individual circumstances.

In Canada, retirement income is typically subject to lower tax rates, especially if the recipient is in a lower income bracket during retirement. Moreover, Canada does not impose a lifetime allowance charge, which in the UK can affect pensions valued above a certain threshold. By transferring to a QROPS, you may also benefit from avoiding the UK’s inheritance tax, as the funds are outside the UK tax net.

2. Currency and Investment Flexibility

Another significant advantage of transferring to a QROPS is the flexibility in currency and investment options. When your pension remains in the UK, it is typically held in British pounds. This exposes you to currency exchange rate risk, which can impact the value of your pension when converted to Canadian dollars. By transferring to a Canadian QROPS, you can hold your pension in Canadian dollars, eliminating currency exchange risks and making financial planning more straightforward. This helps ensure a more predictable stream of income in retirement, especially if you intend on staying in Canada for your retirement.

Additionally, QROPS offers broader investment choices compared to many UK pension schemes. This flexibility allows you to tailor your investment strategy to better suit your risk tolerance, investment preferences, and retirement goals. Whether you prefer stocks, bonds, mutual funds, or other investment vehicles, a QROPS can provide the options you need to optimize your retirement portfolio.

3. Simplified Retirement Planning

Managing multiple pensions across different countries can be complicated and time-consuming. Transferring your UK pension to a QROPS in Canada simplifies your retirement planning by consolidating your retirement funds into a single jurisdiction. This consolidation makes it easier to track your investments, manage withdrawals, and comply with local regulations.

Having your pension in Canada means you only need to navigate one set of tax laws and reporting requirements. This simplicity reduces the administrative burden and allows for more straightforward financial planning and management. It can also provide peace of mind knowing that your pension is governed by the same legal framework that applies to your other Canadian financial assets.

4. Avoiding Exchange Rate Risks

As mentioned earlier, leaving your pension in the UK exposes you to currency fluctuations between the British pound and the Canadian dollar. These fluctuations can significantly impact the value of your retirement income, potentially reducing your purchasing power if the exchange rate moves unfavorably.

By transferring your pension to a QROPS in Canada, you eliminate the need to constantly monitor and react to exchange rate changes. Your pension will be in the same currency as your daily expenses, ensuring a stable and predictable income stream. This stability is particularly important during retirement when you rely on a fixed income to cover your living expenses.

5. Greater Control and Flexibility Over Your Retirement Funds

A QROPS transfer can provide greater control and flexibility over how and when you access your retirement funds. UK pension schemes can often have rigid rules about when and how you can withdraw your funds. In contrast, Canadian retirement plans typically offer more flexible withdrawal options, allowing you to access your money in a way that suits your retirement lifestyle.

For example, with a Canadian QROPS, you can choose to take lump sum withdrawals or regular income payments, depending on your needs. This flexibility enables you to better manage your retirement income and plan for large expenses or unexpected financial needs. It also allows for more effective estate planning, as you can pass on any remaining pension funds to your beneficiaries under Canadian inheritance laws.


Transferring a UK pension scheme to Canada via QROPS offers numerous advantages for UK expatriates living in Canada. From improved tax efficiency and currency flexibility to simplified retirement planning and greater control over your funds, a QROPS transfer can significantly enhance your financial well-being in retirement.

If you are considering this option, please do not hesitate to reach out to us to ensure that it aligns with your specific circumstances and retirement goals. By making an informed decision, you can enjoy a more secure and comfortable retirement in Canada.

If you are interested in learning more about transferring a pension scheme from the UK to Canada, please contact us today for a free, no obligation consultation.