The minimum age at which benefits can be taken was raised from 50 to 55 with those taking benefit under 55 prior to April 6 2010 able to continue to do so, if they do not transfer.

If people taking benefits transfer into a new scheme, whether a QROPS, SIPP or any other pension, they may be penalised for making an unauthorised transfer and could be hit with a 55% charge.

Roger Berry, managing director of QROPS provider Concept Group, who is also chairman of Guernsey’s QROPS industry panel, said HMRC had sought to confirm their interpretation of the legislation and had confirmed a strict approach. Further, HMRC had not committed to when or if it would alter them nor pledged not to penalise people who make transfers in the meantime.

He said he had stopped accepting transfers that would be caught by the change – and urged industry colleagues to do the same – estimating the numbers of such transfers could run into hundreds.

“A lot of this will be down to interpretation but in our opinion this is unfair and unjust and until the legislation changes we will be able unable to accept transfers from those in drawdown aged between 50 and 55 until HMRC review this policy and amend the legislation.”