Expats could face additional pension access charges post-Brexit – PensionBee

Pension savers living abroad could face additional charges and significant delays when accessing their retirement savings once the UK leaves the EU, PensionBee has warned.

The provider noted that costs to withdrawing savings from abroad could increase “significantly” as payments to overseas banks will present additional costs to pension providers, which may be passed on to the customer, alongside charges imposed by the receiving bank.

PensionBee said that pension providers in the UK generally only make pension payments into UK bank accounts, which are easier to validate technologically and benefit from the confirmation of payee security measures.

However, PensionBee warned that, once the UK leaves the EU, many British banks will close the accounts of overseas savers, which will force them to access their pensions through European bank accounts.

For savers to change bank details with their pension provider, they often need to post documentation, which PensionBee stated could cause “significant delays” during the Covid-19 pandemic.

Furthermore, the provider expressed its concern that pension providers may struggle in the short term to make payments abroad in a timely manner.

It also noted that providers are on high alert regarding overseas pension scams and may refuse to transfer a pension abroad or take up to six months to complete the necessary due diligence to release the funds.

Commenting, PensionBee chief executive, Romi Savova, said: “Pension providers must work quickly to adapt their systems and provide cost-effective solutions for their customers, in order to avoid leaving overseas pensioners in limbo without access to their retirement savings.

“In the meantime, we urge pensioners living abroad to plan ahead and ensure they have sufficient funds in place to cover their living expenses for several months.

“Expats already withdrawing from their pensions should investigate whether receiving pension payments from the UK will have tax implications in their country of residence, and may wish to seek advice from a local tax adviser.”

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