buckbuchanan Posted December 8, 2014 Share Posted December 8, 2014 Hi all I have been told that there will be a change in the pension laws in the UK in April which will prevent you from moving pension to Australia in future. I believe this affects government pension plans (military, NHS, etc). Does anyone have any information on this? Is it really happening? Is it best to transfer now, or leave where it is and take the hit at retirement age?? Quote Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted December 9, 2014 Share Posted December 9, 2014 Hi buckbuchanan Sorry for the late reply. Yes it is true that there is a pension ban coming in to play for government un-funded defined benefit schemes (NHS, Police etc) that will prevent them being transferred to UK defined contribution schemes and due to this at this stage by default this would seem transfers to Oz will also be banned, please have a look through this thread regards this: http://www.pomsinoz.com/forum/money-finance/220374-government-response-uk-pension-ban-australia-qrops.html In relation to transferring and whether you should will depend on a whole range of factors and depending on your personal situation a transfer may or may not be the correct course of for you, for example what age do you plan to retire, how much do you wish to achieve in retirement, what other forms of income and assets are you likely to have in retirement as this will have implications on your tax position and Australian Age pension position, these are just some of the considerations. Given the time it takes with the transfer process it would be prudent to look into this sooner rather than later so that you are in a position to make a fully informed decision. I hope this helps. Regards Andy Quote Link to comment Share on other sites More sharing options...
fifi69 Posted December 9, 2014 Share Posted December 9, 2014 I have 11 years worth of NHS pension. Although, still 20 years away from retirement, is there any drawbacks to not do anything and just have it paid into my UK bank account?? Quote Link to comment Share on other sites More sharing options...
buckbuchanan Posted December 10, 2014 Author Share Posted December 10, 2014 Hi Andrew. Many thanks for taking the time to reply. I will do some more looking into it in that case... Quote Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted December 10, 2014 Share Posted December 10, 2014 I have 11 years worth of NHS pension. Although, still 20 years away from retirement, is there any drawbacks to not do anything and just have it paid into my UK bank account?? No, no drawbacks as such in that you will still be entitled to receive what you have accrued to date of leaving with inflationary increases from that date until the schemes normal pension age. Once in payment you will receive the annual pension along with continuing inflationary increases. If transferred your monies would work very differently in the Australian system and there would not be a guaranteed income for life instead the monies transferred would be taken as a lump sum and invested. The balance at retirement would then provide your retirement income based upon how you decide to take it ie lump sum, purchase an annuity (income for life) or invest and draw on the capital (commonly via an Account Based Pension), this may or may not have a better outcome. Also income from the superannuation system in Australia is generally tax-free in retirement whereas taken as foreign income ie UK pension income it would be assessed for tax, again this may or may not be a better or worse outcome depending on your situation in retirement and other income and assets. I generally advise anyone with a final salary scheme (defined benefit) to take advice from an Adviser who will work with them to explore the implications of both scenarios so that an informed decision can be made along with professional guidance. Be aware that there a lots of companies willing to offer this service for free via free advice or a free report but really this is based on providing a generic report and only really highlighting why a transfer should occur as this is where they will be remunerated as charge a fee on transfer only. If you are really serious about investigating a transfer you should engage an Adviser on the basis of them charging a fee for the initial advice and work done with you so that there is not a bias on transferring. All of that said you could be cutting it fine now anyway as mentioned above. Hope this helps. Regards Andy Quote Link to comment Share on other sites More sharing options...
Steve123 Posted December 10, 2014 Share Posted December 10, 2014 Hi Andy, I am off to Perth next year and i want to transfer my private UK Pension to an Australian Super. Do you know if it is still possible to take the 25% tax-free lump-sum , and then transfer the balance ? Or do you think is it best to transfer to entire pot, and then take a lump-sum after arriving in Aus ? Do you know if there is a limit in the amount that can be transferred ? Thanks for your help. Steve Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.