The number of transfers to Qualifying Recognised Overseas Pension Schemes (Qrops) has halved from 9,700 in 2016/17 to 4,700 in 2017/18, the second lowest number since records began.
According to data from HM Revenue & Customs (HMRC), the value of the transfers also fell, from £1.2bn to £740m, following new tax rules introduced by the government.
From March 2017, following Philip Hammond's spring budget, all Qrops transfers were subject to a 25 per cent tax charge, with some exceptions, such as if the scheme is based in the same country as the retiring individual.
It was revealed at the time that the government’s targeted charge on Qrops was expected to raise £65m in 2017/18, £60m in both 2018/19 and 2019/20, and £65 in both 2020/21 and 2021/22.
FTAdviser reported last year that enquiries into overseas pension transfers had surged post-Brexit ahead of the imminent triggering of Article 50.
But Clare Moffat, head of business development at Royal London, said the latest decrease was to be expected, due to the tax charges.
She said: "The government intended that Qrops were not misused to provide an improved tax position for those who didn’t intend to leave the UK on a long-term basis.
"So they should now only be used by someone who is moving abroad and intending to remain abroad."
Ms Moffat also said scheme administrators of the registered pension schemes or the scheme manager of the Qrops are jointly liable for the overseas transfer charge.
This means "they had to decide whether or not they wished their scheme to continue to be a Qrops following the introduction of the overseas transfer charge, which also will have had an impact" on the figures.