UK Pension Transfers
Transferring your UK pension funds to New Zealand means you could:

Transferring your UK pension funds to New Zealand means you could:

  • Have better control over your money
  • Have more flexibility and investment options
  • Enjoy some tax advantages
  • Enjoy a superior lifestyle in New Zealand

There are many advantages in transferring your UK pension to New Zealand.
With over 30 years experience in advising customers on the best way to transfer their UK pension funds, UK Pension Transfers Ltd can simplify and speed up your transfer process by helping you to make informed decisions.

  • We have successfully transferred over 1000 UK pensions.
  • We have a 100% success rate for eligible clients. And your savings are much greater than the cost of our service

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New rules will apply to transfers to QROPS where the transfer is made on or after 6 April 2017

  • Any transfers received on or after 6th April 2017 will be subject to UK tax rules for five tax years after the date of transfer, regardless of whether the individual is resident or not in the UK for tax purposes. This means that even where an individual has been a non UK tax resident for more than 10 tax years, on a transfer made after 5th April 2017, UK tax rules will apply for 5 tax years after the date of transfer.
  • You will generally be allowed to take 25% of your pension pot as a tax free amount. The rest will be subject to tax at your marginal rate (the highest rate of tax you pay in a tax year). If you take your entire pension as cash, this may push you into paying a higher tax rate.  But as they probably won’t know your other income sources in a tax year, they may use an “emergency tax code” which may well deduct too much tax initially. If you pay too much tax you can reclaim it from HMRC either by completing a P50 tax form, or when you complete a Self-Assessment tax return.

       What does this mean?

  • The transferred funds are locked in until age 55.  Once you reach age 55, you are allowed to withdraw 25% of the funds free of UK tax, the same as a person living in the UK.
  • You may take more than 25% of the funds, but if you take  the extra funds within 5 full tax years after the date of transfer, these funds will be subject to UK tax, the same as a person living in the UK.
  • If you leave the funds until after 5 tax years after the date of transfer, you may withdraw the funds free of UK tax.  This is a better deal than for a person living in the UK. They will NEVER be free of UK tax!
  • The 70% income for life requirement has been removed.

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New Zealand IRD have changed the way Foreign Superannuation is taxed. From 1 April 2014 ALL lump sum pension transfers will be taxable.

The new tax rules came into effect on 1 April 2014.

    • If you leave your pension in the UK and don’t transfer it at all, you will have to pay tax on all withdrawals.  This means you will pay tax on 100% of all your pension payments, as well as pay tax on your 25% lump sum, based on the number of years you have lived in New Zealand. In summary, the longer a person has lived in New Zealand, the worse the tax position will be. Please refer to Schedule 33 below.
    • If you transfer your pension to New Zealand within 4 years of living in New Zealand, there is NO TAX to pay.
    • If you leave your transfer until after 4 years of living in New Zealand, you will have to pay tax on the amount transferred. Please refer to IR1024 detailing the percentage of your pension that will be subject to tax after 4 years.
    • Please note the tax is not calculated as part of your pension transfer, it is not automatic. It is your responsibility to declare these funds when you do your tax return for the 2015/16 year.

Here is information from the New Zealand IRD on Top 10 facts on international tax

If you have not yet transferred your pension then please contact us urgently

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The April 2015 Pensions Regulator Rule Changes for Defined Benefit schemes with a Transfer Value of more than £30,000

Regulated financial advice from a UK Adviser

  • Due to the recent April 2015 Pensions Regulator rule changes, any individual looking to transfer from a defined benefit (DB) to a defined contribution (DC) scheme must by law receive regulated financial advice from a UK Adviser authorised by the Financial Conduct Authority (FCA) before going ahead if the transfer value is more than £30,000.
  • If your UK pension is a Defined Benefit scheme with a Transfer Value of more than £30,000, this will apply to you
  • Many UK Adviser firms authorised by the FCA who are willing to provide this service to overseas clients charge thousands of pounds to provide the necessary report.

The good news: 

  • We have carefully researched the UK Advisers authorised by the Financial Conduct Authority (FCA)
  • We have an agreement in place with a UK Adviser firm to provide IFA advice to clients who wish to transfer their over £30,000 defined benefit pensions to New Zealand.
  • We have found an affordable TVAS (transfer value analysis) report.

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BREXIT:

Since Brexit was announced we have seen the increase in enquiries for transfers out of UK pension schemes and in particular out of DB schemes.

It would appear that British people are facing an uncertain future, as most economists are agreeing that the UK faces a short to medium term decline in prosperity and thatBrexit will lead to UK interest rates and gilt yields being lower for longer.   This could mean that DB scheme transfer values will remain high and may even tend to increase. 

On the other hand lower economic growth during this period of uncertainty, which can be expected to continue for the foreseeable future, may reduce equity returns.  

Reduced equity returns combined with low and possible lower gilt yields will put the funding levels of DB schemes under even greater pressure. 

Therefore the reasons for transferring out of DB schemes are possibly greater now than they were before.

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Top 10 facts on international tax

New Zealand residents are taxed on their "worldwide income", that is income from New Zealand as well as from other countries. A New Zealand resident individual that receives interest income from the United Kingdom will be taxed on that income in New Zealand as well as the United Kingdom. Your worldwide income includes any income that you derive in a foreign country even if you do not bring the money into New Zealand.

 

Please Refer to Note 1: New Zealand residents are generally taxed on their worldwide income

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Fidelity Super-Super Plan, Number 3 – Transition to Grosvenor

From 1 April 2016, Grosvenor will take responsibility for managing and running the Fidelity Super-Super Plan, Number 3 - a recognised overseas pension scheme capable of accepting UK pension transfers.

Grosvenor has significant experience and expertise managing investment funds.

Grosvenor is one of the largest New Zealand owned and operated investment businesses managing over $2 billion on behalf of over 100,000 investors.

What this transition means for existing clients:

  • There are no changes in fees or costs to you;
  • From 1 April 2016, the Scheme will change to a portfolio investment entity (PIE) structure which has significant tax advantages for members on lower tax rates;
  • You will see enhancements in the reports you receive; and
  • Later this year you will be able to view your Plan information online 24 hours a day, 7 days a week

What you need to do:

  • To take advantage of the changes, provide Grosvenor with your IRD number
  • Provide your PIR number so that you are taxed at the correct rate

Please contact us if you have any questions.

For more information about Grosvenor and the Fidelity Super-Super Plan, Number 3 please visit their website

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UK HMRC QROPS Rules from 6 April 2012

All UK Pension Transfer funds must be deposited in a Qualifying Recognised Overseas Pension Scheme (QROPS).

All the schemes we recommend have confirmation that they have been accepted as a QROPS.

Please click here for more details.

In summary:

  • Clients will not be able to withdraw from the NZ QROPS scheme before age 55
  • 70% of the original transfer value must be used to provide an "income for life".
  • The remaining 30% plus any growth may be withdrawn as a cash lump sum after age 55
  • Any withdrawals of transferred UK pension funds from the NZ QROPS scheme may be subject to UK tax if you have not been a non-resident for UK tax purposes for five complete UK tax years.

 

A Disclosure Statement is available on request and free of charge. Click here to view

Certified AFA   ( Authorised Financial Adviser )  . Click here to view

Strategi Institutes's QROPS Course. Click here to view

Qualified ALU  ( Associate Life Underwriter ). Click here to view

FSP Registered 19444. Click here to view

New rules will apply to transfers to QROPS where the transfer is made on or after 6 April 2017

Any transfers received on or after 6th April 2017 will be subject to UK tax rules for five tax years after the date of transfer, regardless of whether the individual is resident or not in the UK for tax purposes. This means that even where an individual has been a non UK tax resident for more than 10 tax years, on a transfer made after 5th April 2017, UK tax rules will apply for 5 tax years after the date of transfer.

 You will generally be allowed to take 25% of your pension pot as a tax free amount. The rest will be subject to tax at your marginal rate (the highest rate of tax you pay in a tax year). If you take your entire pension as cash, this may push you into paying a higher tax rate.  But as they probably won’t know your other income sources in a tax year, they may use an “emergency tax code” which may well deduct too much tax initially. If you pay too much tax you can reclaim it from HMRC either by completing a P50 tax form, or when you complete a Self-Assessment tax return.

What does this mean?

The transferred funds are locked in until age 55.  Once you reach age 55, you are allowed to withdraw 25% of the funds free of UK tax, the same as a person living in the UK.

You may take more than 25% of the funds, but if you take  the extra funds within 5 full tax years after the date of transfer, these funds will be subject to UK tax, the same as a person living in the UK.

If you leave the funds until after 5 tax years after the date of transfer, you may withdraw the funds free of UK tax.  This is a better deal than for a person living in the UK. They will NEVER be free of UK tax!

 
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