The UK government has confirmed a 4.1% increase in the State Pension for the 2025/26 tax year, following the Triple Lock mechanism. While this is good news for pensioners in the UK, it does little for those retiring abroad—unless they take action. Expats in India who rely solely on their UK State Pension won’t see this increase, as their pensions remain frozen under outdated government policies. But for those who have transferred their pensions through a QROPS pension transfer, this presents a unique advantage.
Why Expats in India Won’t Get the UK Pension Increase
The UK’s Triple Lock system guarantees that State Pensions rise annually by the highest of inflation, average earnings growth, or 2.5%. This year, with earnings growth at 4.1%, pensions will rise accordingly. However, retirees living in India—along with many other countries—will see no increase at all.
The reason? The UK government does not adjust pensions for expats in countries without a reciprocal agreement. This means that anyone who retired to India on a UK State Pension has been locked into the same payment they received when they first moved—regardless of inflation or cost-of-living changes.
How a QROPS Pension Transfer Puts Expats Ahead
For expats in India, this outdated system highlights the real advantage of a QROPS pension transfer. Unlike the frozen UK State Pension, a QROPS pension transfer ensures that retirees can actually benefit from rising pension values. Here’s how:
- No Frozen Pensions – Unlike the UK State Pension, QROPS pensions grow over time, allowing expats to keep up with inflation.
- Better Tax Treatment – QROPS jurisdictions often offer more favorable tax rates, ensuring retirees keep more of their money.
- Currency Flexibility – Expats can hold funds in INR or other stable currencies, reducing dependence on GBP fluctuations.
- Investment Growth – QROPS offers a range of investment opportunities to help pensions grow beyond what’s possible in the UK system.
Why Now is the Time to Act
With the latest UK State Pension Triple Lock increase, many believe the system to be unsustainable. While the UK government’s refusal to adjust pensions for expats in India is unlikely to change, those who take control of their financial future with a QROPS pension transfer don’t have to worry about outdated policies holding them back.
By moving their UK pension into a QROPS pension transfer, retirees in India can secure their financial future, benefit from tax advantages, and ensure their retirement income keeps up with inflation—something UK State Pension holders in India will never get.