Following the introduction of a 25% tax charge on transfers into QROPS based outside of the EEA, in its annual results for 2016, published this morning, STM Group said the ‘worst case scenario’ would see it receive £1.1 million less than expected in revenue this year.
STM believe the government change will ‘stagnate some of the QROPS market in Gibraltar and Malta’ which will lead to opportunities to make acquisitions.
STM had been reviewing ways to enter the UK SIPP market for some time to complement their existing international pensions business and provide a solution for those expatriates returning to the UK. In October 2016, STM saw the realisation of an important strategic objective by way of the acquisition of the SIPP provider, London & Colonial Holdings Limited (“LCH”). In its annual results, STM said it expected this SIPP business to be used as an alternative by advisers and clients who would have chosen a QROPS transfer before the introduction of the 25% tax charge.