As specialists in pension transfers, Cameron James has helped clients from diverse backgrounds and professions worldwide. Many of our clients are UK employees working abroad, in the United States, the European Union, or other countries. Among these are oil and gas professionals working for Shell who live outside the UK and want to know how to transfer Shell pension assets into a suitable UK-based pension scheme.
We’ll guide you through the process of transferring your Shell Pension to the country where you currently reside. Before diving in, you might find it helpful to watch a detailed video explanation from Independent Financial Adviser and our CEO, Dominic James Murray.
🎥 Check out our YouTube channel for more expert guidance on UK Pension Transfers
Shell Overseas Contributory Pension Fund
As a firm, Shell established the Shell Overseas Contributory Pension Fund (SOCPF). The SOCPF protects Shell employees living and working abroad a UK contract from being placed in a higher tax rate. For people who do not work in the UK, this Shell Pension Program is only available and regulated in Bermuda. It is a strong, well-funded final salary pension scheme. Because of the high level of expertise of the employees, and matching salaries, massive benefits are built up over time in the SOCPF.
How to Transfer my Shell Pension
When leaving Shell, transfer values can range from hundreds of thousands to millions of pounds. Due to the complex nature of the SOCPF, clients often face challenges deciding on the right advice and choosing the best scheme to transfer to.
Pension Transfer Scam
SOCPF transfers are not classified as defined benefit UK pensions, so FCA-licensed financial advice is not mandatory. This can lead to scams, fraud, and hidden fees. Some advisers have been found charging commissions as high as 5-7% without clear disclosure, which can be costly for members.
If you have a Shell pension and want to transfer it safely, work with a trustworthy IFA. Ensure they offer transparent fees and have a strong track record. At Cameron James, we've handled many Shell pension transfers and understand the unique challenges involved.
Some clients who previously worked with other advisers reported incomplete or unclear information. At Cameron James, we provide a thorough consultation process. The process often lasts between 5-6 weeks and consists of detailed communication to ensure you fully understand your options.
What Options Are Available for the SOCPF Member?
For example, we are currently assisting a British-Chinese national residing in a third country. Although he holds a UK passport, his pension was enrolled in Bermuda’s Shell Overseas Contributory Pension Fund and is valued at £1.2 million. He wishes to transfer his pension into a qualified UK pension scheme. This a complex situation that involves navigating multiple Shell documents and regulations.
Our client conducted thorough research and compared advice from three or four financial counselling firms, including ours. The differing quality and clarity of the advice he received highlighted how easily someone could be misled by seemingly professional but poor guidance.
When considering how to transfer Shell pension, the three main options are: QROPS, International SIPP, or QNUPS.
Qualifying Recognised Overseas Pension Scheme (QROPS)
The first option available to him is to transfer to a QROPS. A QROPS is an international pension system based in Malta that accepts transfers. Malta has designed QROPS systems that comply with HMRC regulations and Malta pension legislation. Malta is also one of the most renowned QROPS nations and does not clash with HMRC standards. Persons moving their Shell Pension to a QROPS in Malta would benefit from significant tax flexibility.
However, QROPS was not the best option for him because the country where he resided had no double taxation agreement with Malta, the usual jurisdiction for QROPS transfers. This meant transferring his Shell pension to a Malta QROPS would restrict his ability to use Flexible Access Drawdown (FAD), limiting withdrawal options at retirement.
International Self-Invested Personal Pension Scheme (iSIPPs)
Another option is to transfer the SOCPF fund to an international Self-Invested Personal Pension Scheme (iSIPP). An iSIPP lets him manage his pension from anywhere and access a wider range of investments. He can withdraw up to 25% of his fund as a lump sum and choose how much to withdraw annually, tailoring income to his needs.
However, pension funds over £1.07 million are subject to the UK Lifetime Allowance (LTA). Any amount above this allowance faces heavy taxation. At the time of writing, this is 55% if taken as a lump sum, or 25% if taken as income. Using an iSIPP could result in significant tax charges on the pension pool.
Qualifying Non-UK Pension Scheme (QNUPS)
We explored other options with the client and chose a QNUPS based in Guernsey. This option suited the client’s situation because Guernsey does not deduct tax at source, even though no double tax agreement (DTA) exists between his country and Guernsey. Guernsey has no DTAs because it does not tax foreign nationals on income from their Guernsey assets. The only limitation is that if the client becomes a Guernsey resident, they must pay income tax on any withdrawals.
QNUPS offers a tax-efficient strategy for UK citizens, especially Shell Pension holders, to minimise taxes on pension assets and protect those assets for distribution to beneficiaries after death. For him, using a QNUPS provides an effective way to shield his pension from HMRC taxation.
How Cameron James Can Help You
If you are a member of the Shell Overseas Contributory Pension Fund and considering transferring your pension, seeking professional financial advice is essential. Without expert guidance, you risk costly mistakes and hidden fees that could significantly reduce your pension’s value.
At Cameron James, we pride ourselves on transparency, providing fixed-fee, clear, and comprehensive pension transfer advice tailored to your unique situation. Our experienced IFAs specialise in Shell pension transfers and will help you navigate complex options like QROPS, iSIPPs, and QNUPS to find the best tax-efficient solution.
Don’t leave your pension’s future to chance.
Book your free consultation now and take the first step toward securing your financial future with trusted pension transfer specialists.