pension

[justcantwait]

Hi everyone

Just have a couple of questions if anyone can help, we have been here 7 yrs and our pension is still in the Uk, we have heard that we can bring it over and then use it for buying or investing in a business or house. Does anyone know if this is right and also is there a time frame from when we bring it over to being able to use the money? Also will we be taxed on it?

 

Many thanks Anne marie x

[Bridgeman]

What type of pension do you have? You may not be aware that the UK government has changed the rules lately on the type of pension which can be transferred abroad. Have a look here:

http://www.pomsinoz.com/forum/financial-advice-ask-vista/224380-changes-uk-pension-laws.html

 

 

We brought our pension over and invested in an Australian super scheme and this is what I understand from our experience. The whole process took about a year to sort out. No doubt an expert will be along soon to elaborate more.

 

If you don't have a government pension then it may be possible to transfer, but it would be better to take some professional advice as to whether you are better off leaving your pension in the UK and drawing it in pounds when you retire.

If you do want to bring it over then there is usually a 6 month window from arrival in Australia when you can bring your pension over without tax penalties. After that any increase in the value of the fund from when you arrived in Australia to when you transfer it will be taxed. As you have been here for 7 years then I assume you will have to pay some tax on it. We were also outside the window, but fortunately (from a tax point of view) there had been no increase in the value in the interim so there was no tax to pay.

 

You will need to transfer your pension to an approved QROPS (Qualifying Recognised Overseas Pension Scheme) and this will still be subject to UK pension rules for 5 years and reporting for 10 years, which normally meant that you could only still take 25% in cash. I understand the UK rules about this have also changed recently in that I believe you can access all your pension, but I think only 25% is tax free. I am not sure how this now affects any superannuation schemes which are still under the UK rules, maybe the experts can elaborate. If you take your pension as a regular income then normally it is tax free here in Australia.

 

I don't think it is as simple as just bringing the money over and accessing it all immediately. Not sure if there is some way round this, but we were told we could only access 25% as a lump sum.

[Parley]

Hi everyone

Just have a couple of questions if anyone can help, we have been here 7 yrs and our pension is still in the Uk, we have heard that we can bring it over and then use it for buying or investing in a business or house. Does anyone know if this is right and also is there a time frame from when we bring it over to being able to use the money? Also will we be taxed on it?

 

Many thanks Anne marie x

 

How old are you ?

I'd be amazed if you can cash it in before pension age and spend it on something like a house or business venture ?

[Andrew from Vista Financial]

Hi everyone

Just have a couple of questions if anyone can help, we have been here 7 yrs and our pension is still in the Uk, we have heard that we can bring it over and then use it for buying or investing in a business or house. Does anyone know if this is right and also is there a time frame from when we bring it over to being able to use the money? Also will we be taxed on it?

 

Many thanks Anne marie x

 

Hi Anne marie

 

I assume you mean through a Self Managed Super Fund (SMSF) as accessing money from pensions/superannuation is generally based on retirement and access before this time is generally not allowable.

 

If you are then unfortunately it is not permitted by HMRC to invest into residential property using UK pension monies (even though it is possible through Australian monies via an SMSF) even if the monies have been transferred to Australia and are in an SMSF.

 

In the first instance however you should consider whether a transfer of your pensions are right for you and your retirement goals and objectives, also depending on the type of pensions you have you may find it is no longer possible to transfer, what schemes are they?

 

kind regards

 

Andy

[justcantwait]

Hi Andy

Thank you for you reply, thats was what i was talking about self managed super. An accountant told me that we could use our money for investment property or business, but i was unsure as the accountant doesnt deal with the international side of it. It is just a private pension my hubby paid into for a while, we were unsure about moving it as there isnt a lot in it, but thought if we could use it to invest then maybe it would be worth it. We are just unsure what to do. So you are saying that we cant use it if we move it?

Many thanks Anne marie x

[KirkyG]

I think that is exactly what Andy is saying. He helped me move my pension and gave me invaluable advice.

[Andrew from Vista Financial]

Hi Andy

Thank you for you reply, thats was what i was talking about self managed super. An accountant told me that we could use our money for investment property or business, but i was unsure as the accountant doesnt deal with the international side of it. It is just a private pension my hubby paid into for a while, we were unsure about moving it as there isnt a lot in it, but thought if we could use it to invest then maybe it would be worth it. We are just unsure what to do. So you are saying that we cant use it if we move it?

Many thanks Anne marie x

 

Residential property is not permitted, commercial property may be allowable. Into a business...not too sure on HMRC's stance on this but from an Australian perspective can potentially be done but can also be complex: https://www.ato.gov.au/super/self-managed-super-funds/investing/carrying-on-a-business-in-an-smsf/

 

You can use the money to invest into property funds, shares etc through super that does not have to be an SMSF however it could just as well be better leaving it in the UK.

 

Just be aware that it is beneficial for an Accountant to have a client open an SMSF as it means more revenue for them in accounting fees each year and it may not actually be the most appropriate strategy or best retirement planning outcome. Obviously I am not suggesting this is what he is doing but just a point to note.

 

Regards

 

Andy