Posts Tagged ‘New Zealand QROPS’

Global QROPS Ltd at the Summer New Zealand Migration Seminar

Tuesday, July 13th, 2010

Following the success and high demand for the ‘Live and Work in New Zealand’ seminar on 24th April 2010, a second seminar has been arranged for August.

On Saturday 14th August 2010, in Guildford in Surrey, Global QROPS Ltd will be talking about the financial matters (such as tax exemptions selling or retaining UK property, life assurance, tax, savings and investments and, of course, pension transfers to New Zealand) to help make your migration to New Zealand as tax efficient and financially successful as possible.

As well as Global QROPS Ltd, other key speakers include a New Zealand banking expert, a currency exchange broker, an international removals expert and a couple of recruitment agencies. This seminar will be headlined by a prominent New Zealand migration agent who can tell you how to obtain the visa you require to make your move to New Zealand happen.

This seminar is ideal for teachers, people in the medical profession, IT professionals, chefs, social workers, electricians, electronic engineers, urban planners and auditors who are looking for a fresh start in New Zealand.

This seminar represents a tremendous opportunity for anyone serious about migrating to New Zealand to commence planning their move.

There is a limit for the number of spaces at this event, therefore please send your details and your Curriculum Vitae to info@migrationassociates.co.uk in order to assess your eligibility to migrate.

Please feel free to contact us for more information. Global QROPS Ltd look forward to seeing you there.

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UK Expat Pension Members in Australia

Thursday, February 4th, 2010

A large percentage of migrants that enter Australia each year come from the UK. Indeed, around about 30,000 of the migrants that enter Australia each year come from the UK, according to a study in 2008. Putting this into perspective, this is more than New Zealand migrants to Australia (around 27,000) and those from India and China (around 22,000 from each country).

For those UK migrants living in Australia many of them would have UK pension benefits held in the UK. Should a UK expat pension member in Australia transfer their UK pensions to Australia?

Whether a UK pension transfer to Australia is a good idea or not is a big issue, not just for a UK expat pension member but also for a returning Australian that has returned to Australia after a period of work in the UK.

The benefits from a UK pension scheme can vary. This is because historically the UK has a variety of pensions that provide different benefits. For example, a final salary (defined benefit) scheme is not a common type of scheme throughout the world. The benefits from this type of scheme depend on the years of service an individual has from their employer, their final remuneration and the scheme accrual rate. This is unlike an Australian scheme where benefits depend on the fund size at retirement – where there are no guarantees.

If you are a UK expat pension member of a final salary scheme how can you compare two totally different types of benefits, in two different countries, in order to decide whether a pension transfer to Australia would be advantageous or not?

The advisers at UK based IFAs Global QROPS Ltd have many years of experience advising on pension transfers to Australia from the UK and can make firm recommendations to UK expat pension members in Australia deliberating on what to do with their UK pensions.

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UK Pension Transfers to New Zealand QROPS – Tax rates

Friday, December 25th, 2009

People that consider migrating (or returning) to New Zealand from the UK, who are members of UK personal or employer sponsored pension schemes, often speak to Global QROPS Ltd regarding the best retirement planning advice regarding their pensions.

For all members of UK pension schemes, the QROPS (Qualifying Recognized Overseas Pension Scheme) transfer option is available.

If you transfer your UK personal or employer pension to a New Zealand QROPS, and you are a resident of New Zealand at retirement, those benefits would be paid to you tax free.

What happens, however, if you are resident of New Zealand and decide not to exercise the QROPS option and take your retirement benefits directly from a UK scheme?

If you are not entitled to the ‘new or returning resident’s tax exemption’ in New Zealand, (or the exemption period has expired) any payments made from a UK scheme would be taxed at a New Zealand resident’s highest marginal rate.

The basic tax rates in New Zealand (for tax year 2009/10) are banded as follows:

0 – NZ$14,000 @ 12.5%
NZ$14,001 – NZ$48,000 @ 21%
NZ$48,001 – NZ$70,000 @ 33%
NZ$70,000 and over @ 38%

If you are considering a move to New Zealand and you are thinking about taking retirement benefits directly from your UK scheme, you should speak to Global QROPS Ltd first. If you take your benefits in the form of an annuity or final salary pension, you can not transfer your benefits to a New Zealand QROPS and you would have lost the option to receive your pension benefits tax free.

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A Pension Transfer to New Zealand QROPS – Investment Restrictions

Friday, December 4th, 2009

UK expat pension members and potential UK migrants to New Zealand, look for guidance and advice regarding many aspects of New Zealand QROPS (Qualifying Recognized Overseas Pension Schemes).

As well seeking assistance regarding income levels, tax advantages and possible death benefits available from a New Zealand QROPS scheme, UK pension members – and in particular those UK pension members that have plenty of time to go before retirement – enquire as to whether they can vary their investments to greater degree than they could in a UK scheme.

Broadly speaking, New Zealand superannuation schemes (approved as QROPS) have similar investment capabilities as UK pension schemes – although growth and income within the QROPS are subject to tax – for example, unitised funds and investment managers.

Many UK expat pension members in New Zealand, however, also want to know if they can affect a pension transfer to New Zealand and use those funds to invest in more diverse investments.

Since the launch of the QROPS rules in the UK, on 6th April 2006, the question of permitted investments has come up. For example, the most common discussion point is residential property – as this is not permitted as an investment in UK Self Invested Personal Pensions (SIPPs) or UK Small Self Administered Schemes (SSASs).

Residential property, in the HMRC manuals, falls under the category of ‘Taxable Property’. In other words, a QROPS administrator would have to report an investment of a residential property to HMRC. Furthermore, unlike pension and lump sum payments to QROPS members where there is a 5 year reporting period, there is no time limit on reporting for residential property as an investment. UK pension members should not fall into the trap of thinking that transferring pensions to a New Zealand (or any other) QROPS allows you to invest in anything because there are UK tax charges if you chose to invest in something such as residential property.

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Will the GMP in my Final Salary Scheme Transfer to my New Zealand QROPS?

Tuesday, October 20th, 2009

If you are a member of a UK contracted out final salary scheme, since before April 1997, there is every likelihood that you have an element of GMP (guaranteed minimum pension) in your scheme. Migrating pension members, looking to transfer to a New Zealand QROPS (Qualifying Recognized Overseas Pension scheme), would have to consider the benefits of their GMP.
GMP is the bare minimum an employer’s final salary scheme has to provide for its members contracted out of the state earnings related pension (SERPS) between 6th April 1978 to 5th April 1997. GMP is an undertaking to pay a certain final salary benefit at retirement age 65 for men and age 60 for women.
When someone is looking at UK pension transfer to New Zealand QROPS, the transferring final salary scheme will offer the pension benefits (including the GMP) in the form of a transfer value. This value would be the amount of money that the New Zealand QROPS receives.
At retirement, the New Zealand QROPS would have a duty to pay the member either cash or income from the scheme but would NOT be required to match the GMP benefits the original final salary scheme provided.
Although the benefits from a New Zealand QROPS are paid tax free, there is no guarantee that the income would last you for ever. This may not be a problem if you are looking at the more flexible income from a QROPS, however, final salary scheme should take specialist QROPS advice from, Global QROPS Ltd, before transferring.

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UK Pension Transfers to a New Zealand QROPS – The Tax Considerations

Monday, October 5th, 2009

There are clear advantages, for someone migrating to New Zealand, in completing a UK pension transfer to a New Zealand QROPS (Qualifying Recognised Overseas Pension Scheme). The obvious advantage is that the benefits from a New Zealand scheme, registered as a QROPS, can be taken tax free by New Zealand residents. There are, however, other considerations.

The first question is the timing of the transfer. Is there a rush to move the UK pension funds to a New Zealand QROPS? The answer to this question lies, not just in the costs of the New Zealand QROPS (compared to a UK pension), but also with the tax and exchange rate considerations of the two countries.

As previously mentioned, the major appeal with New Zealand QROPS is the access to tax free benefits, however, the funds building up within a New Zealand scheme – prior to drawing benefits – would build up subject to New Zealand tax.

With regards to the question of the exchange rate, is there an urgency to transfer straight away. Is there some flexibility in your retirement planning that lets you wait for a favourable exchange rate? Ideally, you should look at ways of locking in at a decent exchange rate before you transfer.

Global QROPS Ltd can advise you before your migration to clarify what you should do with your UK pension benefits and whether a QROPS is the right option.

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UK Pension Transfers to a New Zealand QROPS

Wednesday, September 30th, 2009

UK migrants to New Zealand need to consider their UK pension options before they leave the UK. Many migrants, who have researched the subject, would know that if they wanted a pension transfer to New Zealand to happen, then the receiving scheme would have to be registered as a Qualifying Recognised Overseas Pensions Scheme (QROPS).

Throughout New Zealand, there are many superannuation schemes that have been registered and approved by the UK’s Her Majesty’s Revenue and Customs (HMRC) as QROPS.

Each New Zealand QROPS would fall under the same tax legislation in New Zealand and also the same UK QROPS rules within the 5 year reporting period. However, each scheme would have their own sets of charges and costs.

Therefore, when you transfer a UK pension to New Zealand, how do you decide what to do and which QROPS to use?

The key strategy would be to get suitable advice for your UK pension before you leave the UK – preferably from a specialist in UK pension transfers to New Zealand. Once you have spoken to a specialist adviser, regarding your retirement plans and goals, it would become clearer as to which is the most suitable QROPS.

Although you are migrating to New Zealand, you may wish to look at QROPS in other jurisdictions as well. Remember, HMRC allows UK pension transfers to QROPS in countries other than the one you are migrating too. Should you settle for a QROPS in New Zealand, however, then the entry charges, annual management costs and exit penalties of each scheme should all be considered.

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Why do I need Advice on a UK Pension Transfer to Australia or New Zealand?

Thursday, September 24th, 2009

For people considering a move Down Under advice son their UK pension funds is not always high on their list of things to do. Even those people who may have contemplated receiving advice on a UK pension transfer to Australia or New Zealand may have dismissed it as unnecessary or an unwanted expense – particularly when you consider the cost of migrating as a whole.

In the long term the cost of not considering your options with your UK pension could be higher than taking the advice. Many people know someone who has already migrated and their advice from them may be ‘wait until you get there’ or  ‘I didn’t need advice, I just got my employer to transfer my UK pension to Australia (or New Zealand)’. However, this in itself is advice and not necessarily well conceived advice. You would have to ask yourself, did your friend do the right thing in the first place? Did they migrate on the same visa as you (as this affects your tax status)? Are the pension fund sizes identical – as yours could be affected by the Australian cap whereas your friend’s fund was not affected? What exchange rate did the funds transfer over on? Does your Australian employer have a scheme capable of taking UK pension transfers in? ie is it a QROPS?

Sweeping aside the issue of UK pension advice before you migrate to Australia or New Zealand could prove expensive if you are not fully aware of the tax or exchange rate issues.

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Global QROPS Ltd offer Offshore Pension options to New Zealand migrants

Thursday, August 20th, 2009

For individuals migrating to New Zealand it has always been important for them to look at their options for their UK pensions.

Since the introduction of Qualifying Recognised Overseas Pensions Schemes (QROPS) by the UK HMRC in April 2006, UK pension benefits can transfer to approved, offshore pensions throughout the world – including New Zealand.

Given the tax free nature of benefits paid from a New Zealand scheme, it would be a logical step, in most cases, to transfer UK pension funds to a QROPS in New Zealand. However, although benefits in New Zealand are tax free, the growth of the funds within the New Zealand QROPS would be taxed.

Up until recent changes in the New Zealand legislation, any income paid from a UK pension scheme to a New Zealand resident would be subject to the New Zealand foreign income tax rules. However, the changes in the legislation have meant that a New Zealand resident can receive income from a UK pension scheme (or another offshore QROPS) in certain circumstances and not be taxed.

This has opened up some key tax efficient options for New Zealand migrant’s UK pensions where previously the only way of receiving tax free benefits was to transfer UK pension funds to New Zealand QROPS.  Global QROPS Ltd advisers can recommend the most beneficial option for anyone with UK pensions looking to migrate to New Zealand.

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