Brianqpr

A thought that has just occurred to me. Surely SMSFs have the same risk of money being released if there is an excess contribution? Why therefore do over 55 SMSFs appear to be ok to remain on the ROPS list? I work in financial advice complaints/disputes and the majority of excess contribution problems occur in the over 55 age group.

Thanks for this, interesting info. It does seem that an under 55 solution is unlikely to be forthcoming. As for the transfer value, it has risen a lot over the last few years but who knows what the next valuation would be? I did read about DB values falling but then, when I got mine valued after that, it had gone up substantially again. The exchange rate is also a factor. We have had $3 to the pound in the not too distant past and, while it seems unlikely now, it is possible we could get to those sort of levels again. I have a feeling the $500k cap won't happen and that the cap amount is likely to be higher than that, maybe $1 million which is a much more reasonable level. I have no previous NCCs. Potentially moving into a UK based money purchase scheme could be an answer to capture an attractive transfer value and then hold until age 55?

I have a defined benefit UK pension fund that at last valuation was worth close to £140k and has risen substantially over recent years. The changes to the ROPS rules are concerning as I had planned to transfer the fund to Australia when the time is right (i.e. once there is a better exchange rate!). If I have to wait until 55 (8 years away for me), and the fund keeps growing the way it has, I may have issues with contribution caps, especially if this ridiculous proposal for a $500k lifetime NCC cap gets up.. The exclusion of most schemes is ridiculous and seems to be purely based on the financial hardship and compassionate grounds release of fund options possible in Australia. These options are very limited in terms of how much it is possible to withdraw, and it is very difficult to meet the criteria to withdraw funds in this way. I assume the UK has removed most funds from the ROPS list due to (unfounded) concerns that people might be able to use these conditions of release to access transferred funds early. Has any effort been made to explain to the UK side just how limited these options are? One solution I can think if is that funds could isolate contributions received as a result of a UK transfer and exclude this from any early access through financial hardship or compassionate grounds conditions of release. This may contradict SIS though. Perhaps we could look at amending the SIS rules to exclude UK transfers from these conditions of release if we can't get the UK side to change its position? I would like to know what efforts are being made to address this situation with the UK side?