There appeared to be almost no opposition to the legislation when the vote was taken, the sources said.
The second and final reading by the Legislative Review Committee is expected during the week of March 26, which it is thought would be in time for Guernsey to meet the proposed new regulations on QROPS, which were issued by HMRC on 6 Dec, and are due to take effect on 6 April.
The advantage of this timing is that the second reading would take place after the 2012 UK Budget is unveiled on 21 March, when, sources in the industry believe, the final version of HMRC’s revised QROPS regulations is likely to be published.
However, a spokesman for HMRC told International Adviser it will be "mid to late March" before final regulations are issued, and stressed that it will not be included in the Budget as it is "secondary legislation".
Roger Berry, managing director of Guernsey-based Concept Group, said he believed the legislation would be approved by Guernsey’s Legislative Review Committee without a problem.
As reported, Guernsey’s proposed "new category of scheme" provides for a “one-size-fits-all” pension that could be open to islanders and non-residents alike – with no Guernsey tax due on benefits paid – in order to address a key concern raised by HMRC in December, the so-called “Condition 4” clause.
Surprise
This and other concerns raised by HMRC came as a surprise to providers of qualifying recognised overseas pension schemes around the world, although many privately said they believed the Revenue had been unhappy for some time with what it is understood to believe is the abuse of the QROPS regime by some unscrupulous pensions administrators.
Of the changes proposed by HMRC, the most problematic for a number of jurisdictions, including Guernsey but also for some administrators on the Isle of Man, has been a stipulation that the payments of all qualifying recognised overseas pension schemes be taxed at the same rate at which pensioners resident in the jurisdiction in which the QROPS is administered are also taxed.
Until now, Guernsey has taxed its residents’ pensions but not those of non-residents, who were assumed to pay tax on their pension income in the country in which they lived.
In the Isle of Man, only the recently-introduced "50C" type of schemes are potentially affected by the "Condition 4" requirements, a QROPS industry spokesman there said.
