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Tea4two

claiming pension when leaving oz as PR

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Just to add to the confusion. I spoke to my super fund a couple of months ago with regards to withdrawing my money from my fund. One scenario was if you are over 55 when you depart permenantly to retire from Australia then you can withdraw all your funds. I was quite surprised by this as I'm an Australian citizen. I don't have it in written form but I did get the man to repeat what he said.

 

Not sure why you're surprised.

 

For everyone born before 1960, 55 is their 'preservation age' - the age where superannuation can be withdrawn.

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I have just this minute read an article in the West Australian written by a financial expert on page 5 of Your Money. Someone asked him if he could use some of his super fund to purchase a property to let out as an investment. The basic jist of it is that yes you can, but the purchase must be funded wholly from the super fund (i.e. no topping up from your own pocket), any maintenance costs need to come out of the same super fund, the property must be bought at fair market rate and from someone you don't know, and it must be rented out to a third party at market rate. So you can't use it to buy your sisters house and rent it out to your cousin. I am assuming that any rent/profit then goes back into the super fund until retirement age.

 

The closing statement of the article is 'Sometimes we focus too much on informing people about complex issues, and in particular on what they cannot do with their SMSF under the superannuation law. We forget that, from time to time, we should also let people know about the things they can do. Investing in property, if done in the right way, can be part of a SMSF's investment strategy and can become a typical sound investment for SMSFs.' Monica Rule, author of The Self-Managed Super Handbook

 

So, you can invest it in property, then at retirement age choose to sell the house if you wish.

 

Hope that helps!


Making some hay whilst the sun shines

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I have just this minute read an article in the West Australian written by a financial expert on page 5 of Your Money. Someone asked him if he could use some of his super fund to purchase a property to let out as an investment. The basic jist of it is that yes you can, but the purchase must be funded wholly from the super fund (i.e. no topping up from your own pocket), any maintenance costs need to come out of the same super fund, the property must be bought at fair market rate and from someone you don't know, and it must be rented out to a third party at market rate. So you can't use it to buy your sisters house and rent it out to your cousin. I am assuming that any rent/profit then goes back into the super fund until retirement age.

 

The closing statement of the article is 'Sometimes we focus too much on informing people about complex issues, and in particular on what they cannot do with their SMSF under the superannuation law. We forget that, from time to time, we should also let people know about the things they can do. Investing in property, if done in the right way, can be part of a SMSF's investment strategy and can become a typical sound investment for SMSFs.' Monica Rule, author of The Self-Managed Super Handbook

 

So, you can invest it in property, then at retirement age choose to sell the house if you wish.

 

Hope that helps!

 

But the consensus is that you need at least $250k super balance to make it worthwhile setting up and maintaining a SMSF.

 

Unlikely that the OP has that sort of money in super after only a couple of years here.

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I’ve no interest in getting into an argument and I agree with you that there should be an official way of revoking residency or transferring your pension overseas. You spent a lot of time and money getting the permanent residency so that you could get the exact same rights as an Australian and that’s what you’ve gotten, for better or worse.

 

Unfortunately there’s no a la carte residency where we can choose the best bits of each countries laws so we have to just accept that some things won’t work out the way we wanted. I’m going to have the exact same issues as you when I return home but I accepted this when I signed up for it.

 

It is still your money; it’s still there and you still have complete control over where it’s invested. Any pension you build up in the UK will be the same, you won’t be able to access it until retirement.

 

Again Mark, I wasn't asking for judgement on what I knew or didn't know know before I came here. I was asking for advice if anyone knew any loopholes etc. I've advised why I don't want it sat here its messy, the exchange rate could be worse then but you aren't listening, just judging. I've not taken this to my local councillor shouting and screaming - I've posted a bloody thread on poms in OZ. I am aware that if there are no loopholes I'll have to suck it up.


Vic SS applied 03/11, granted 05/11, IELTS passed 09/11 score 9/8/8/8.5 overall 8.5, pos skills assessment 18/10 ,176 app 22/10, granted 16 Dec 2011!

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But the consensus is that you need at least $250k super balance to make it worthwhile setting up and maintaining a SMSF.

 

Unlikely that the OP has that sort of money in super after only a couple of years here.

 

Hehe but I wish! ;)


Vic SS applied 03/11, granted 05/11, IELTS passed 09/11 score 9/8/8/8.5 overall 8.5, pos skills assessment 18/10 ,176 app 22/10, granted 16 Dec 2011!

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If you left the country on a pr visa it doesn't last forever, so maybe you just have to wait for it to expire???

 

This is what I was thinking. If we lave within our first 5 years and don't get an extension for the RRV then we can no longer return but I'll certainly bring this up with the financial advisor and see what he thinks x


Vic SS applied 03/11, granted 05/11, IELTS passed 09/11 score 9/8/8/8.5 overall 8.5, pos skills assessment 18/10 ,176 app 22/10, granted 16 Dec 2011!

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There are people (on here I believe) who have managed to get their super out having left as PR but the ATO seems to indicate that you can't - or maybe they just don't want to advertise that it is possible! You do, apparently get slugged tax on it though unlike retrieving it over preservation age when it is tax free.

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This is what I was thinking. If we lave within our first 5 years and don't get an extension for the RRV then we can no longer return but I'll certainly bring this up with the financial advisor and see what he thinks x

 

Every time the question come up on this site (who seems to know what they're talking about): http://www.superguide.com.au/accessing-superannuation/accessing-super-early/i%E2%80%99m-leaving-australia-can-i-access-my-super the answer is always 'No'.

I’m permanent resident planning to go back to my home country for good. Can I cash in my super when my PR Visa expired? The point of that thought is that when my PR Visa expired and I didn’t renew it I would be refused entry anyway.

your answer is greatly appreciated.

Thanks,

Burhan.

Reply

0bbea95d8b2fb93f064902c7fd715fa3?s=48&d=identicon&r=PGTrish Power says:

August 16, 2011 at 10:31 am

 

Hi Burhan

Thanks for your comment and sorry for the delay in responding. Generally speaking, permanent Australians cannot access super before retirement, even when the PR visa expires. You can verify your personal circumstances with the ATO. The following articles may help you with your question:

http://www.superguide.com.au/accessing-superannuation/accessing-super-early/permanent-departure-from-australia

http://www.superguide.com.au/accessing-superannuation/accessing-super-early/accessing-super-early-temporary-resident

http://www.superguide.com.au/accessing-superannuation/accessing-super-early/12-legal-reasons-to-cash-your-super

Regards

The SuperGuide team

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Agreed it is not officially allowed.

 

As Quoll mentions there has been a post or two in the past on these types of forums that one or two people have actually done this but I am not sure how as it is not within regulation as does not constitute a condition of release.

 

 

A Departing Australia Superannuation Payment (DASP) is only for temporary residents whose visa has expired, see also http://www.ato.gov.au/Individuals/Super/In-detail/Temporary-residents/Super-information-for-temporary-residents-departing-Australia/?default=&page=8

 

 

Regards

 

 

Andy

Edited by Andrew from Vista Financial

Financial Adviser (FPA Member AFP ®) Specialising in UK Expat Advice and Pension Transfers / AR-322874 /AFSL-234951

SMSF Accredited Adviser / UK SIPP Authorised Adviser 

Director  - Vista Financial Services – www.vistafs.com.au 08 8381 7177

 

Please note that my advice is general advice only and professional financial advice should be sought for your own personal situation.

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There are people (on here I believe) who have managed to get their super out having left as PR but the ATO seems to indicate that you can't - or maybe they just don't want to advertise that it is possible! You do, apparently get slugged tax on it though unlike retrieving it over preservation age when it is tax free.

 

No-one has ever reported first-hand that they've got their super back as a PR. It's always been a friend who supposedly did it, or a friend of a friend, or someone they heard about.

 

I suspect it's an urban myth.

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But the consensus is that you need at least $250k super balance to make it worthwhile setting up and maintaining a SMSF.

 

Unlikely that the OP has that sort of money in super after only a couple of years here.

 

Well it may help out others that may be reading this thread. I wasn't about to make any assumptions about how much money someone has.


Making some hay whilst the sun shines

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Not sure why you're surprised.

 

For everyone born before 1960, 55 is their 'preservation age' - the age where superannuation can be withdrawn.

 

I was surprised because all I've ever read on this site with regards to getting your super back when you leave the country is that you have to be on a temporary visa, otherwise, you have to wait until retirement age. A preservation age is not the same as the current retirement age. So, because of my ignorance I was surprised.

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No-one has ever reported first-hand that they've got their super back as a PR. It's always been a friend who supposedly did it, or a friend of a friend, or someone they heard about.

 

I suspect it's an urban myth.

This is true!!! Although I believe there are some who are in the process of trying it (on their friends' advice) so it'll be interesting to see whether we ever get a step by step guide on which form to fill, which process to follow. However I do agree that as Aus lets pension pots be transferred in, it should also, at the very least, allow them to be transferred out!!!

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There is a way. Fourcorners has already mentioned it, and it does not need to be only worth it for big funds. I know a lot of people with self managed funds. You turn the fund into a self managed fund. You use it to buy an investment property. You lease the investment property to your wife.

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There are a number of comments about fees eating super amounts up so it ends up with nothing in it - I am worried about this as I will leave a modest (under $100K) sum in super when I leave Australia in 2015 (I'm a citizen). I'm quite an old bird however - presumably if super is not being topped up, it makes sense to claim it as early as possible (55) before it gets snaffled up in fees? Can you draw on your Australian super if based in the UK, over 55 but still working?

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There are a number of comments about fees eating super amounts up so it ends up with nothing in it - I am worried about this as I will leave a modest (under $100K) sum in super when I leave Australia in 2015 (I'm a citizen). I'm quite an old bird however - presumably if super is not being topped up, it makes sense to claim it as early as possible (55) before it gets snaffled up in fees? Can you draw on your Australian super if based in the UK, over 55 but still working?

 

Hi

 

This page gives information about when it is possible to access Super: http://www.ato.gov.au/Individuals/Super/In-detail/Receiving-benefits/Withdrawing-your-super-and-paying-tax/

 

It may be possible to access some of it but of course you should consider any potential UK tax implications there may be by doing so.

 

I wouldn't be concerned about fees eating the fund up though, the main fees with Super are Management Expense Ratios (MERs) and are based on a percentage of the balance. Generally the returns will outweigh these fees.

 

For very small pots the issue is the member/administration fees (average between $80 - $100 annually and insurance premiums (if any) as these can impact.

 

For example a pot of $1,000 with an admin fee of $100 and insurance premiums of $100 would equate to 20%!!

 

 

Regards

 

 

Andy


Financial Adviser (FPA Member AFP ®) Specialising in UK Expat Advice and Pension Transfers / AR-322874 /AFSL-234951

SMSF Accredited Adviser / UK SIPP Authorised Adviser 

Director  - Vista Financial Services – www.vistafs.com.au 08 8381 7177

 

Please note that my advice is general advice only and professional financial advice should be sought for your own personal situation.

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