Benefits of transferring your UK Pension to New Zealand
The Financial Migration Group provides a personalised service to transfer your UK Pension Scheme into an approved scheme in New Zealand. Only schemes that are Qualifying Recognised Overseas Pension Schemes (QROPS) are allowed to receive UK Pensions.
QROPS came as a result of pension simplification in the UK, which came in 2006. New Zealand QROPS are approved by the UK’s HMRC and regulated by the New Zealand Securities Commision.
The rules are designed to ensure that ex UK Residents can only transfer to overseas pension funds that have similar rules to the UK.
Our experienced, UK qualified team will liaise directly with your UK pension provider to facilitate the transfer on your behalf. Being completely impartial we have access to all the leading QROPS providers in New Zealand and will recommend the most appropriate scheme to suit your needs.
Benefits of transferring to a QROPS
Consolidate your UK Schemes into one fund.
If you have left behind a number of schemes from various employers you can consolidate occupational and personal pensions into one NZ superannuation scheme.
Where you are a member of a final salary i.e. a defined benefit scheme, your UK pension entitlement is converted into a capital sum or Cash Equivalent Transfer Value (CETV) for transfer to New Zealand to a QROPS.
Free up some cash now before retirement!
You can free up some cash from your UK pension to help with the costs of moving to New Zealand, buying a home, setting up a business or paying back some of your mortgage. Or, you may want to release funds to invest the money independently to maximise your returns.
If you transfer your UK pension to an approved scheme in New Zealand you may be able to access up to 40% of the amount transferred immediately if you are over 50 or if you have been a non – UK tax resident for a full five years (note1).
The remaining 60% of the balance transferred can be accessed either five years after being transferred or when you reach 55, whichever occurs last. If you are over 50, 25% of your funds may be released to you, tax free, prior to transferring into a QROPS (note1).
Have full access to your funds in retirement.
Typically when retiring in the UK, 75% of your funds must be used to purchase an annuity which provides you with a guaranteed but taxable income for the remainder of your life. Unfortunately under this scenario you can no longer access funds as a lump sum.
If you transfer your pension to a QROPS in New Zealand, all funds transferred can be paid to you personally (note 2). In retirement you can then have control of your funds and the flexibility to choose how your funds are spent and invested.
Create your own fund.
Our UK qualified and New Zealand experienced investment team can help you gain more control over your funds. If you are familiar with Self Invested Pension Plans in the UK (SIPPS) we can utilise a similar scheme that allows you to self select your investment components should you wish. The Pegasus Investment Fund allows access to thousands of investment products from NZ, Australia, US and UK. We will work with you to choose and maintain your investments, and you can be as active or hands off as you like.
If you choose you can even transfer your scheme and keep it in pounds sterling until the exchange rate moves in your favour.
Notes -1. From April 6th 2010 the minumum age will increase to 55 - 2. Timing can be dependant on QROPS legislation and specific policy criteria.
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January 31st, 2010 at 3:11 pm