Withdrawing Super

Hi, I have been in Australia as a permanent resident since 2009. I gathered up all the various pensions that were taken out with various employers over the years and put them in one fund prior to transferring them into a new super fund which was opened by my new employer.

I subsequently worked for the next four years adding as much to the fund as was possible. I have now been retired for 2 1/2 years and receiving a super payment as well as a monthly UK one.

this has worked well until last week when I contacted my Super fund to ask for a lump sum of $4500 which I needed over and above my regular pension payment. I was assured that it would take three working days to clear into my bank.

yesterday my financial advisor rang to say that there was a bit of a delay as the UK tax office requires information before it could be released? I had to reel off my NI number and the date of my entry into Australia!

This beggars belief as I was originally told that my Super could be accessed much like a bank. I'm at a loss to know what business it is of anyone let alone the U.K. Tax office to require this sort of information?

my advisor ( assistant) could not give me a proper answer except to say it had something to do with the bulk of the Super was transferred from U.K. Pension funds? At the time it was all done through proper channels regarding money laundering etc, all relevant paperwork was completed and successfully submitted.

i would love to know if this will be an ongoing problem if I so wish to withdraw a lump sum in the future?

Hello Sids Dad

If you transferred pensions from the UK they would have at the time had to go to a Super Fund in Australia that was a Qualifying Recognised Overseas Pension (QROPS) scheme otherwise HMRC would have levied a tax charge of up to 55%.

This money would have at some point in the UK benefitted from UK tax relief and so the UK do have a certain hold so to speak over the money for a certain time period.

For an Australian Super Fund to be recognised by HMRC they agree to adhere to reporting guidelines for a period of time and part of this reporting is based around a member accessing funds (including payments out).

Once reported HMRC will assess whether this payment is authorised or unauthorised.

For it to be authorised then essentially the payment would also have to be allowed from a UK pension fund.

Typically this is access no earlier than age 55 for payments and no more than a 25% pension commencement lump sum.

If it is unauthorised then HMRC will consider whether a member payment charge should apply and this involves looking at whether the member is/or the last time the member was a UK tax resident.

Regards

Andy

Thanks Andy, do you know how long after I have left the Uk would this be irrelevant? Like you said I adhered to the QROPS regs etc but I'm staggered that after being here seven years that there is any interest. It's not as if I'm holding millions of dollars only a paltry $500,00 or so. What about the thousands paid in from my years working in Australia? How does that get accounted?

Cheers for the quick reply too.

No problem and yes have a look here: http://www.pomsinoz.com/forum/showthread.php?t=253939