Last updated 6 November 2026.
Moving abroad does not close your UK pensions. Your workplace pots, any personal pension or SIPP, any final salary scheme and your State Pension record all stay where they are unless you do something with them. The question is whether to leave them, bring them together, or move them to a scheme in your new country, and the rules on that last option changed sharply in 2024. Voluntary National Insurance for people abroad changed again in April 2026, and from April 2027 most unused pension pots come into the scope of UK inheritance tax. This guide sets out the three broad options, what each costs in tax, the State Pension points that catch people out, and a short checklist for the year you leave.
This is general information, not financial, tax or pensions advice. Pension decisions can be hard or impossible to reverse, and for some of them UK law requires regulated advice. Figures and rules below come from GOV.UK, HMRC and FCA pages checked on 19 October 2026.
This piece sits in the Grow section. It pairs with What happens to your brokerage account when you move country (the same question for your ordinary investments) and A low-cost portfolio when you are not in one tax jurisdiction.
The short version
- Leaving your UK pensions where they are is usually allowed and is often the simplest option. You can normally still take benefits from abroad.
- Consolidating within the UK (moving several UK pots into one UK scheme) is a separate decision from moving abroad, and is governed by the same rules as for UK residents.
- Transferring to an overseas scheme (a QROPS) can trigger a 25% overseas transfer charge. Since 30 October 2024, transfers to schemes in the EEA or Gibraltar no longer get their own exemption.
- Final salary (defined benefit) pensions worth more than £30,000 cannot be transferred into a pot without regulated advice, by law.
- Your State Pension can be paid abroad, but it only rises each year if you live in certain countries.
- Voluntary NI from abroad got harder from 6 April 2026. Class 2 is gone for most people abroad, and new Class 3 applicants need 10 years of UK residence or contributions.
Option 1: leave your pensions where they are
For many people this is the default and the right starting point. The pension stays invested in the UK scheme, under UK rules, and you take benefits when the scheme allows. A few practical points if you do:
- Keep your contact details current. Schemes write to you about statements, options and changes. A pension you cannot be reached about is easy to lose track of.
- Check how the scheme pays abroad. Ask whether it can pay into a non-UK account or only a UK one. If you will live in another currency, think about the exchange cost each time a payment arrives.
- Expect the UK to tax it in the first instance. GOV.UK’s guidance on UK income if you live abroad says you usually pay tax on UK income, including pensions, even if you are not UK resident. If your new country also taxes it and has a double taxation agreement with the UK, you can claim relief in the UK so you are not taxed twice. Article 18 of the OECD Model Tax Convention, which many treaties follow, gives pensions paid for past employment to the country you live in, but treaties differ and the relief has to be claimed.
- Know the tax-free lump sum limit. GOV.UK says you can usually take up to 25% of a pension as a tax-free lump sum, with an overall limit of £268,275 (the lump sum allowance). How your country of residence treats that lump sum is a separate question, and some countries tax it.
Option 2: consolidate within the UK
If you have several old workplace pots, combining them into one UK pension can make them easier to manage from abroad: one login, one statement, one set of charges to compare. Living abroad does not change the main questions: what you give up in each old scheme (guarantees, protected tax-free cash, lower charges), what the new scheme charges, and whether it will deal with an overseas address.
Two cautions. First, check that the receiving UK provider accepts customers with an overseas address before you start a transfer. Second, if any of the pots is a final salary scheme, consolidating it into a pot is a defined benefit transfer, and the advice rule below applies.
Option 3: transfer to an overseas scheme (QROPS)
A qualifying recognised overseas pension scheme (QROPS) is an overseas scheme that can receive transfers from UK registered pensions. HMRC’s Pensions Tax Manual (PTM102200) sets out when the 25% overseas transfer charge applies. In outline, a transfer to a QROPS is charged at 25% of the transferred value unless one of these exclusions applies:
- you are resident in the same country as the QROPS;
- the QROPS is an occupational scheme and you are employed by a sponsoring employer;
- the QROPS is an overseas public service scheme and you work for a participating employer; or
- the QROPS is set up by an international organisation you work for.
Until 2024 there was also an exclusion for QROPS in the EEA or Gibraltar where the member lived in the UK, the EEA or Gibraltar. HMRC’s newsletter 164 and section 32 of the Finance Act 2025 removed it for transfers made on or after 30 October 2024. It now survives only for transfers requested before that date and completed before 30 April 2025. In practice, moving a UK pension to a scheme in Spain while you live in Spain may still be excluded under the first condition, but moving it to a scheme in Malta while you live in Spain no longer is.
The overseas transfer allowance
Even where an exclusion applies, there is a cap. PTM102200 says your overseas transfer allowance equals your lump sum and death benefit allowance, which GOV.UK puts at £1,073,100 as standard. Any amount transferred above your available allowance is charged at 25%, and the allowance is reduced by earlier transfers and by lifetime allowance used before 6 April 2024.
The five-year watch period
An excluded transfer can become chargeable later. If your circumstances change within the “relevant period” (for example, you move away from the QROPS’s country), the 25% charge can arise after the event. PTM102200 defines the relevant period as running from the transfer date to the next 5 April, plus five more tax years. Illustrative: a transfer made on 1 November 2026 would be watched until 5 April 2032. The charge can also become repayable if you move into an excluded position within that period.
Check the scheme, every time
HMRC publishes a list of schemes that have told it they meet the recognised overseas pension scheme conditions. GOV.UK says the list is updated on the 1st and 15th of each month; the most recent update at the time of writing was 2 November 2026. HMRC is blunt about what the list means: “We cannot guarantee these are ROPS or that any transfers to them will be free of UK tax.” It adds that schemes can be removed at short notice, for example where fraud is suspected, and that accessing benefits before 55 will result in UK tax charges “in all but the most exceptional circumstances”. Anyone promising early access to pension money through an overseas transfer is a red flag.
Illustrative: what the charge looks like
| Illustrative case | Exclusion? | Charge on a £100,000 transfer |
|---|---|---|
| Lives in Australia, transfers to an Australian QROPS | Yes: same country (subject to allowance and the watch period) | £0 at transfer |
| Lives in Spain, transfers to a Maltese QROPS (requested after 30 October 2024) | No: different country, EEA exclusion removed | £25,000 |
| Lives in Australia, transfers to an Australian QROPS, moves to the US two years later | Yes at transfer, but lost within the relevant period | £0 at transfer; £25,000 can then arise |
The cases are fictional and simplified. The 25% rate and the exclusions are from PTM102200. The “transferred value” is not always the amount that leaves the scheme; PTM102500 explains the calculation.
Final salary pensions: the £30,000 advice rule
A defined benefit (final salary) pension promises an income for life, usually with increases. Transferring it into a pot, in the UK or abroad, swaps that promise for a sum of money you then have to invest and draw yourself. The FCA’s consumer page says: “We believe most people would be best advised not to transfer their DB pension.” It also says that if the value is more than £30,000 “you must, by law, get advice from a regulated financial adviser”, from a firm with permission for pension transfer advice. The scheme will check for that confirmation before it lets the transfer go.
Two more FCA points that matter if you are abroad and dealing with this at a distance: your transfer value is only guaranteed for 3 months, and you may have to pay for another valuation if you ask again within 12 months. Find the adviser before you request the figure.
Your State Pension from abroad
It can be paid abroad, but may not rise
GOV.UK says your State Pension will only increase each year if you live in the EEA, Gibraltar, Switzerland, or a country with a social security agreement with the UK that allows it. It names Canada and New Zealand as countries with agreements where you still cannot get the increases. Outside those places, the amount is fixed at the level when you first claimed or left, and it goes up to the current rate if you return to live in the UK.
That is worth factoring into any long-range plan. A pension that never rises loses buying power every year that prices go up.
UK tax on the State Pension
GOV.UK’s guidance for people living abroad says non-residents do not usually pay UK tax on the State Pension. Your country of residence may tax it.
Filling gaps: voluntary National Insurance after April 2026
This changed on 6 April 2026. GOV.UK’s voluntary National Insurance guidance for people abroad now says:
- For 2026 to 2027 onwards, you cannot pay voluntary Class 2 contributions for time abroad. The government’s policy paper says the only exceptions are certain self-employed people covered by a social security agreement and volunteer development workers.
- You can apply to pay Class 3 for time abroad after 5 April 2026 if you previously lived in the UK for 10 years in a row, or have 10 years of qualifying contributions. Voluntary contributions paid for other periods abroad, and National Insurance credits, do not count towards the 10.
- Transitional rule: if you applied to pay voluntary Class 2 or Class 3 for 2024 to 2025 or 2025 to 2026 on or before 5 April 2026, you may still use the old 3-year test, provided you pay those contributions and apply for 2026 to 2027 Class 3 on or before 5 April 2027.
The 2026 to 2027 rates are £3.65 a week for Class 2 and £18.40 a week for Class 3. A full year of Class 3 at that rate works out at £956.80 (52 weeks at £18.40). The policy paper says that at 2026 to 2027 rates, Class 3 costs £767 more a year than voluntary Class 2.
Before paying anything, GOV.UK suggests checking your State Pension forecast, or contacting the Future Pension Centre (or the International Pension Centre if you are within 6 months of State Pension age), to see whether extra years would actually add to your pension. You apply from abroad using form CF83.
Inheritance tax on pensions from April 2027
HMRC’s technical note (updated 29 May 2026) confirms that Finance Act 2026 received Royal Assent on 18 March 2026 and that, for deaths on or after 6 April 2027, most unused pension funds and pension death benefits come into the value of the estate for inheritance tax. Some benefits are excluded, including dependants’ scheme pensions and death in service benefits.
Residence matters here too. The note says that for long-term UK residents, inheritance tax applies to these pension funds wherever the scheme is established. For people who are not long-term UK residents, it applies only to schemes established in the UK, so a non-UK scheme is outside its scope. That interacts with the QROPS decision, and it is exactly the kind of cross-border question where specialist advice earns its fee. Whether you are a long-term UK resident is a defined test of its own; the HMRC note does not set it out, so check it separately.
Comparing the three options
| Leave in place | Consolidate in the UK | Transfer to a QROPS | |
|---|---|---|---|
| UK transfer charge | None | None | 25% unless an exclusion applies; allowance cap; five-year watch period |
| Advice required by law | No | Yes, if a DB pension over £30,000 is involved | Yes, if a DB pension over £30,000 is involved |
| Currency | Usually sterling | Usually sterling | Can be your new home currency |
| Rules that apply | UK pension rules | UK pension rules | The overseas scheme’s rules, plus UK rules on the transferred funds |
| Main risk | Exchange costs; admin from a distance | Giving up guarantees in old schemes | Unexpected tax charge; unsuitable or fraudulent schemes |
A checklist for the year you move
- List every pension. Old workplace pots, personal pensions, any final salary scheme. Note the scheme name, policy number and type.
- Update addresses and contact details with each scheme before you go.
- Get your State Pension forecast and look at your National Insurance record for gaps.
- Decide on voluntary NI quickly if the transitional route applies to you; the deadline is 5 April 2027.
- Check the treaty between the UK and your new country for how it treats pensions, and plan the relief claim.
- Do not rush a transfer. If a QROPS is on the table, confirm your residence, the scheme’s listing on the day, the exclusion that applies and the five-year watch period. If any pension is final salary and worth more than £30,000, start with regulated advice.
- Update nominations (expression of wishes forms), especially with the 2027 inheritance tax change coming.
FAQ
Do I have to move my UK pension when I emigrate?
No. There is generally no requirement to move it, and leaving it in place avoids the overseas transfer charge entirely.
Is a transfer to an EU pension scheme still tax-free?
Not automatically. Since 30 October 2024, a QROPS in the EEA or Gibraltar is treated like one anywhere else: the 25% charge applies unless you live in the same country as the scheme or another exclusion applies.
Will my State Pension be frozen if I move to Australia or elsewhere?
It depends on whether the country is on GOV.UK’s list of places where yearly increases are paid: the EEA, Gibraltar, Switzerland, and countries with a UK social security agreement that allows increases. GOV.UK publishes the full list of countries; check it for Australia, or any other destination, before you decide.
Can I still pay Class 2 National Insurance from abroad?
Not for 2026 to 2027 onwards, unless you fall into the narrow exceptions. Class 3 may be available if you meet the 10-year test or the transitional conditions.
Someone has offered to unlock my pension early through an overseas scheme. Is that legitimate?
HMRC says accessing benefits before 55 will lead to UK tax charges in all but the most exceptional circumstances. Treat any such offer with deep suspicion, check the firm on the FCA register, and talk to MoneyHelper before signing anything.
What this article is not
It is not advice on whether to transfer any pension, and it does not cover the tax rules of the country you are moving to, which can treat UK lump sums and transfers very differently. It does not cover public sector schemes in detail, annuities you already hold, or divorce. The illustrative cases are fictional and simplified.
Sources
- HMRC Pensions Tax Manual: PTM102200 overseas transfer charge. 25% charge; exclusion conditions; EEA and Gibraltar exclusion limited to transfers requested before 30 October 2024 and completed before 30 April 2025; overseas transfer allowance; relevant period. Last checked 19 October 2026.
- HMRC: Pension schemes newsletter 164 (October 2024). Removal of the EEA and Gibraltar exclusion from 30 October 2024. Last checked 19 October 2026.
- legislation.gov.uk: Finance Act 2025, section 32. Repeal of section 244C FA 2004 for transfers on or after 30 October 2024. Last checked 19 October 2026.
- GOV.UK: Check the recognised overseas pension schemes notification list (last updated 2 November 2026). Updated on the 1st and 15th; no guarantee of status or tax-free transfer; early access warning. Last checked 6 November 2026.
- GOV.UK: Lump sum allowance. 25% tax-free; £268,275 lump sum allowance; £1,073,100 lump sum and death benefit allowance. Last checked 19 October 2026.
- GOV.UK: Tax on your UK income if you live abroad. UK income including pensions usually taxable; double taxation relief; non-residents do not usually pay UK tax on the State Pension. Last checked 19 October 2026.
- FCA: Pension transfer advice, what to expect (last updated 13 May 2024). Advice required by law above £30,000; most people best advised not to transfer; transfer value guaranteed for 3 months. Last checked 19 October 2026.
- GOV.UK: State Pension if you retire abroad, how your pension is affected. Yearly increases only in the EEA, Gibraltar, Switzerland and agreement countries; not Canada or New Zealand. Last checked 19 October 2026.
- GOV.UK: Voluntary National Insurance if you live or work abroad. No Class 2 abroad from 2026 to 2027; 10-year test for Class 3; transitional rules to 5 April 2027; form CF83. Last checked 19 October 2026.
- GOV.UK: Voluntary National Insurance rates. 2026 to 2027: Class 2 £3.65 a week, Class 3 £18.40 a week. Last checked 19 October 2026.
- GOV.UK policy paper: Voluntary National Insurance contributions abroad from 6 April 2026. Exceptions for Class 2; Class 3 costs £767 more a year than voluntary Class 2. Last checked 19 October 2026.
- HMRC: Technical note, Inheritance Tax on pensions (updated 29 May 2026). Deaths on or after 6 April 2027; Finance Act 2026 Royal Assent 18 March 2026; excluded benefits; long-term and non-long-term UK residents. Last checked 19 October 2026.
- OECD: Model Tax Convention on Income and on Capital 2025 (full version). Article 18: pensions paid in consideration of past employment taxable only in the state of residence. Last checked 19 October 2026.
- GOV.UK: Countries where we pay an annual increase in the State Pension. Full country list. Last checked 19 October 2026.
- Bankrolled: What happens to your brokerage account when you move country.
- Bankrolled: A low-cost portfolio when you are not in one tax jurisdiction.
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