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UK Pension Transfer to France: Everything You Need to Know

UK Pension Transfer to France

France continues to be one of the most popular destinations for British expats. Whether you are moving for work, family, or retirement, one of the biggest financial questions is what happens to your UK pension once you become a French resident. This article is aimed at French residents considering their pension options.

The good news is that your UK pension does not disappear the moment you move abroad. However, the way you access it, how it is taxed, and how you choose to structure it will have an impact on your retirement lifestyle, and eligibility criteria may apply for certain pension transfer options.

What happens to my UK pension if I move to France?

If you have built up pension benefits in the UK, you will still be entitled to them in France. The main difference is how those benefits are paid and taxed.

  • UK State Pension: You can claim this while living in France, as long as you have enough National Insurance contributions. You can start claiming your pension once you reach state pension age, even if you live in France. Crucially, the UK and France have a reciprocal agreement, meaning your State Pension will continue to increase each year in line with inflation. This is not the case in many other parts of the world.
  • Private and workplace pensions: These can still be paid to you, either in the UK or directly into your French bank account. The money paid from your UK pension scheme can be received in the UK or into your French bank account. You can choose to leave your pension in your existing scheme or transfer your pension to an international arrangement, such as a QROPS or international SIPP. The type of UK pension scheme you have may affect your options for transferring your pension. The main point to be aware of is that, once you are tax resident in France, pension withdrawals are usually taxed there.
  • Currency: Most pension providers will pay your income in pounds, but you can often arrange to receive it in euros to reduce exchange rate risk.

Tax considerations for expats in France

When you become a French resident, your worldwide income becomes taxable in France. This includes pensions from the UK. How much tax you pay on your UK pension will vary depending on your residency status and the type of pension you receive. Thanks to the UK-France double taxation treaty, you should not pay tax twice, but you will need to make the correct declarations.

The French tax system works differently from the UK. Pensions are treated as income, and some pension withdrawals may be tax free under certain circumstances. You may be subject to a tax charge if you do not follow the correct procedures for pension transfers. Taxes on pension income can vary depending on your personal circumstances and the specific tax rules that apply. For tax purposes, your residency status in France and the UK is crucial in determining where you pay tax. In some cases, you may still have to pay UK tax on your pension income, depending on the type of pension and the double taxation agreement. For many expats, thinking ahead about how to structure pension withdrawals is a key part of reducing their overall tax liability.

How does the French pension compare with the UK?

Many expats who have lived and worked in both countries wonder how the two systems stack up.

The UK State Pension is a flat amount based on how many qualifying years of National Insurance contributions you have. To receive the full pension, you currently need 35 qualifying years. Your pension pot in the UK can be managed or transferred, but a direct transfer to a French pension scheme is not straightforward due to regulatory restrictions.

The French pension system is based on contributions, with the amount you receive linked to your income history and the number of years you have paid into the system. Transferring a UK pension directly into a French pension scheme is generally not possible, as France is not on the HMRC’s list of recognized schemes, making such transfers complicated and potentially costly. Many workers also build up complementary pensions through french schemes such as the Plan d’Epargne Retraite (PER).

Some expats find that the French system provides a more generous retirement income, while others value the flexibility of the UK model. If you have worked in both countries, the EU coordination rules mean that your contribution history will be recognised when calculating entitlements.

Which countries freeze UK pensions?

If you live in certain countries outside Europe, your UK State Pension may be frozen, meaning it will not rise with inflation. Canada, Australia, and New Zealand are well-known examples.

France, however, is one of the countries where your State Pension will continue to be uprated each year. As an EEA country, France is part of the European Economic Area, which ensures continued uprating of the UK State Pension. This makes retiring in France particularly attractive, as your pension income is protected against inflation. If you have lived in more than one country, your pension entitlements and uprating status may be affected by your residency history.

The UK Pension Transfer Process to France

Transferring your UK pension to France is a significant financial decision that involves several important steps and considerations. Understanding the process and the potential implications will help you make the most of your pension savings and ensure a smooth transition to retirement in France.

The first step is to decide which type of overseas pension scheme best suits your needs. Many British expats consider a Qualifying Recognised Overseas Pension Scheme (QROPS) or an International SIPP, both of which are recognised overseas pension schemes that can accept UK pension transfers. Each scheme offers different benefits in terms of pension structure, flexibility, and tax efficiency, so it’s essential to review your options carefully.

Before you begin the transfer, it’s wise to consult a financial adviser who specialises in cross-border pension transfers. A professional adviser can help you navigate the complex tax rules in both the UK and France, explain the double taxation agreement, and ensure you choose the most suitable pension scheme for your circumstances.

After your pension has been transferred, you’ll need to decide how you want to receive your pension income in France. Many overseas pension schemes allow you to have your pension paid directly into a French bank account, which can simplify your finances and help you avoid unnecessary currency exchange fees. Alternatively, you may choose to use a currency exchange service to convert your pension income into euros.

It’s also important to be aware of the tax implications of receiving pension income in France. As a French resident, you will generally pay tax on your worldwide income, including your UK pension. In some cases, you may also be liable for UK tax if you have not been a non-UK resident for at least five tax years. A financial adviser can help you understand your tax obligations and identify opportunities to minimise your tax liabilities.

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Managing your UK pension from France

While your pension rights remain intact, many expats find that the real challenge is how best to manage their retirement savings once they have moved. Issues such as currency exchange, investment choice, and cross-border taxation can complicate matters. If you have questions about your pension or its transferability, you should consult your scheme manager for up-to-date information about your existing scheme.

This is where a modern solution can make all the difference.

Why International SIPPs are a strong option

An International SIPP (Self-Invested Personal Pension) is a UK-registered pension that allows expats to take control of their retirement savings while living abroad. Unlike transferring into an overseas scheme, an International SIPP keeps your money within the UK system, under the regulation of the Financial Conduct Authority (FCA).

The advantages include:

  • Flexibility: Manage and access your pension from anywhere in the world.
  • Multi-currency options: Hold your investments in sterling, euros, or other currencies to reduce the risk of exchange rate fluctuations.
  • Investment choice: Access a wide range of funds, shares, and ETFs to suit your personal risk profile.
  • UK regulation: Benefit from strong oversight and the security of the UK framework.
  • No overseas transfer charge: Avoid the tax penalties that can sometimes apply to other forms of pension transfers.

For many British expats in France, International SIPPs provide a balance between flexibility, control, and compliance. They allow you to consolidate multiple UK pensions, simplify your retirement planning, and tailor your income strategy to your life in France.

FAQs on UK pension transfers to France

Can I transfer my UK pension directly into the French system? No. Direct QROPS transfers to a French pension scheme are not possible because French schemes are not on the QROPS list or HMRC’s QROPS list. Your UK pension remains in the UK. However, you can manage it more efficiently through an International SIPP.

Do I pay tax in France on my UK pension? Yes. Once you are resident in France, pension income is taxable there. The tax treaty ensures you are not taxed twice. Note that QROPS transfers and pension overseas transfers may be subject to different tax rules depending on the scheme and country.

Can I still receive my UK pension in pounds? Yes, but you may prefer to receive it in euros to avoid exchange rate risks.

Is an International SIPP suitable for smaller pension pots? Yes, they are flexible and work for a range of pension sizes.

Do I need financial advice before transferring? Absolutely. Pension transfers are significant financial decisions, and professional advice ensures you avoid costly mistakes. A financial adviser can help ensure the QROPS receiving your pension is compliant and on the HMRC list to avoid penalties.

Final thoughts: Planning your UK pension in France

Moving to France does not mean losing access to your UK pension. Your State Pension will continue to rise, your private pensions can still be paid, and France’s double taxation treaty with the UK protects you from paying tax twice.

The real question is how to structure and manage your retirement savings so they work for you in your new life abroad. For many expats, an International SIPP is the most practical solution. It gives you flexibility, investment choice, and the ability to plan your retirement income in the currency that suits your lifestyle.

Get in touch

At Harrison Brook, we help British expats in France make the most of their pensions. From evaluating International SIPPs to planning tax-efficient withdrawals, our advisers provide clear, tailored advice.

Contact Harrison Brook today for a free, no-obligation consultation and discover the best pension strategy for your move to France.

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