US Pre-immigration International Pension Planning

Luca is an Italian citizen who is resident/non-domiciled in the UK. While working as an investment banker in London, Luca established two separate pension plans through two separate employers during the early 2000s. Both plans are considered pre ‘A day’ pension plans for UK purposes and Luca has just been advised that his current employer in the private equity industry in London would like to send him to work in New York for the next 5 years.

After taking tax advice from his US tax advisors, Luca understands that the two international pension plans will not be considered qualified pension plans for US purposes, as they are offshore in Jersey, Channel Islands. The US does not have a double tax treaty with Jersey and, upon becoming resident in New York, Luca will pay taxes on any gains in the plan. The two plans have a total value of USD 20m.

Vie International would recommend the trustees of Luca’s pension plan purchase a US compliant Private Placement Variable Annuity. This will allow Luca, as plan member, to move to New York and continue to receive tax deferred investment gains within his plan. It is important for Luca to receive financial, tax and legal advice to help ensure the plan works for both UK and US purposes and that he meets all reporting requirements in the US for holding an offshore trust/pension plan.

Case study results are for illustrative/informational purposes only and may not reflect the typical purchaser's (client’s) experience and are not intended to represent or guarantee that anyone will achieve the same or similar results

Private Placement Life Insurance is an unregistered securities product and is not subject to the same regulatory requirements as registered variable products. As such, Private Placement Life Insurance (or Annuities) should only be presented to accredited investors or qualified purchasers as described by the Securities Act of 1933.