The firm said the new wrapper, called Optimus Retirement Qrops Wrap Scheme No. 1, comes with no establishment fee as well as no charges for transferring existing qualifying recognised overseas pension schemes (Qrops) with an offshore bond.
Andy Dawson, director of Integrated Capabilities, told International Adviser that the firm had decided to offer clients and advisers a low cost Qrops product that allows the flexibility to use any life company.
Unlike rivals, who have created similarly competitively priced products, Scheme No.1 is not restricted by having “tie ins or special discounts” with selected providers, said Dawson.
Advisers will often use life company products such as bond wrappers to hold Qrops investments, such as offshore bonds, he added.
The underlying investments are still administered by the life company.
“Our desire was to create a product that was easily accessible by the market, provided a wide range of investment options, yet remained competitive on fees,” Dawson added.
Despite the low entry price, the product does charge an annual fee of £650 ($854, €775), levying a charge of £75 per drawdown payment.
Freedom of movement of capital
Dawson adds that it’s unclear whether Britain’s decision to leave the EU last month will affect the future of Qrops. The popularity of Qrops as a pension transfer vehicle has long been credited with the EU freedom of movement of capital rules – which the UK government failed to restrict despite tightening conditions on Qrops.
Once the UK is out of the EU this could change and the UK's HM Revenue & Customs may be able to introduce further restrictions.
“With the exit be negotiated over the coming couple of years it’s important the consumer is given the opportunity to transfer their UK pension into a sophisticated, stable, EU jurisdiction,” said Dawson.