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Final salary pension transfers for British nationals living in Portugal can be a complex and confusing process, but it is important to understand the options and potential risks involved.

A defined benefit (DB) pension transfer, also known as a cash equivalent transfer value (CETV), involves transferring the value of your defined benefit pension to a defined contribution scheme, typically a Self-Invested Personal Pension (SIPP) or a Qualified Recognised Overseas Pension Scheme (QROPS).

This can provide more flexibility and control over your pension funds, but it is important to seek professional financial advice and fully understand the risks involved before making a decision.

In this blog, we will discuss everything you need to understand about DB pension transfer Portugal, and how to make the most of your transfer by avoiding the drawbacks. You can also watch a video below discussing the matter.

Majority of Clients in Portugal

The majority of clients we work with in Portugal are British nationals who have decided to retire or take advantage of non-habitual tax residency. Non-habitual tax residency is a beneficial option for those looking to retire in Portugal, as it allows for certain types of income to be taxed at a lower rate.

However, it is important to note that this benefit is not as generous as it used to be, and it is crucial to fully understand the conditions and requirements before applying.

Helping Portuguese Nationals Returning to Portugal

We also work with Portuguese nationals who have returned to Portugal after working in the UK, particularly those who may have worked in finance in London. 

Even though we may not be fluent in Portuguese, we can still provide all of the information and guidance needed for a UK pension transfer. Our goal is to help all of our clients, regardless of their nationalities, make informed and confident decisions about their pension funds.

The Current Situation of Financial Advisory Industry in Portugal

Portugal is considered a heavily over-brocked market, meaning that there is a high concentration of financial advisors in the country. This can make it difficult for clients to find a trustworthy and qualified advisor, as some may resort to old school methods of finding clients through golf clubs or talking to people at bars. 

However, it is important to be cautious and not rush into any decisions based on a financial advisor’s charisma or salesmanship. It is important to ensure that the advisor is professional and qualified, particularly when it comes to final salary pension advice.

Dangers of Working With Unprofessional Financial Advisors

Working with unprofessional financial advisors who lack proper qualifications can be dangerous, as they may not fully understand the complexities and risks involved with final salary pension transfers.

These types of advisors may be charismatic and convincing, but the quality of their advice may be poor. It is crucial to ask difficult questions and thoroughly research the advisor’s qualifications and professional background before making any decisions.

Commission-Based Products and Bonds in Portugal

Commission-based products and bonds are still prevalent in Portugal, and they can be risky for clients. These types of products can lock clients in for a period of 5, 8, or even 10 years, and pay high commissions to the financial advisor.

With the long period, it can limit the client’s flexibility and control over their pension funds, and make it difficult to exit the product without incurring significant penalties. It is important to consider alternative platforms such as Novia SIPP and iPensions SIPP, which are transparent and have no commission inducement or trail fees.

Alternative Platforms

Alternative platforms like Novia SIPP and iPensions SIPP offer a more transparent and cost-effective option for pension transfers. These platforms provide low-cost share classes and do not have any commission inducement or trail fees.

As a client, it is significant for you to always ask difficult questions to financial advisors and fully understand the risks and benefits of transferring your defined benefit pension. It is also essential to take care of your pension and make sure you are getting the best possible advice.

Work With the Right IFA

In conclusion, transferring your defined benefit pension to a defined contribution scheme such as a SIPP or QROPS can provide more flexibility and control over your pension funds, but it is important to fully understand the risks and seek professional financial advice before making any decisions. 

At Cameron James, we specialize in providing professional and qualified financial advice for pension transfers for British nationals living in Portugal. We understand the complexities and risks involved with final salary pension transfers, and we are dedicated to providing our clients with the best possible advice and guidance.

Our team of experts are fully qualified and have extensive experience in the industry, and we are committed to providing transparent and cost-effective solutions for our clients.

Don’t hesitate to book your free initial consultation today to learn more about how Cameron James can help you with your UK pension transfer. Let us guide you through the process and provide you with the best possible advice to ensure that your pension funds are managed in the most efficient and effective way. Contact us today to schedule your consultation and start planning for your financial future.


Dominic James Murray

My career in financial services began in 2010 during my Bachelor of Science (BSc) Undergraduate degree at Aston University in England. The degree required me to spend a year abroad working with an established organisation.

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