The Scotland international signed a four-year deal at Loftus Road after making over 100 appearances for Blackpool since joining from Wycombe in 2010.
But with Phillips' deal at Bloomfield Road due to run for just one more year, Ince admitted they had little choice but to let him go.
"To lose him is a big blow to me," Ince said. "I'm not happy and I'm sure the fans aren't.
"But Matty had a year left and he wasn't prepared to sign a new contract. When an offer comes in for that type of money, business is business.
"He's gone and I wish him all the best because he's been fantastic for us."