Melbourne maz Posted June 25, 2015 Share Posted June 25, 2015 Hi We will moving over to Australia in March in 2017 the following year I will be 55 and want to take advantage of the 25% lump sum from my Uk work pension couple of questions does anyone know .. if I love the pension can I still do this at age 55 or am I better leaving it in the UK and if I do that what are the implications when I do move it? I don't want to have to wait until I'm in my sixties :-( thanks Quote Link to comment Share on other sites More sharing options...
Gbye grey sky Posted June 25, 2015 Share Posted June 25, 2015 HiWe will moving over to Australia in March in 2017 the following year I will be 55 and want to take advantage of the 25% lump sum from my Uk work pension couple of questions does anyone know .. if I love the pension can I still do this at age 55 or am I better leaving it in the UK and if I do that what are the implications when I do move it? I don't want to have to wait until I'm in my sixties :-( thanks What you are planning may leave you liable to Australian tax I suspect. Are you intending drawdown on the work pension as if so I would check the position with the pension provider (via your HR Officer perhaps) to find out what drawdown restrictions may be in place. Are you expecting to retire in Australia as you may have better options? I am 55 in October and have just opened a SiPP and am in the process of moving my work pension fund into it. I then plan to open a Super Fund and transfer via a QROP to the Super fund. Yes, I have to wait until I am 60 to draw it - though no bad thing - but then 100% of drawdown is tax free and not 25%. Quote Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted June 29, 2015 Share Posted June 29, 2015 HiWe will moving over to Australia in March in 2017 the following year I will be 55 and want to take advantage of the 25% lump sum from my Uk work pension couple of questions does anyone know .. if I love the pension can I still do this at age 55 or am I better leaving it in the UK and if I do that what are the implications when I do move it? I don't want to have to wait until I'm in my sixties :-( thanks Yes it is possible to leave the pension in the UK and take the UK tax free lump sum at retirement age (currently 55 in UK). The implications of doing this will be that the lump sum will be assessed for tax in Australia (on the growth), the tax treatment will differ depending on what you do with the remaining 75%. The other option as mentioned is to transfer to an Australian ROPS (recognised overseas pension scheme) however as you have pointed out the age of access may differ (known as preservation age) and just because you have reached preservation age it does not mean that a full condition of release is granted, if under age 65 generally retiring from the workforce is also a requirement. Preservation age is 55 for people, born before 1 July 1960. For those born after that date, preservation age is progressively increasing to 60 years of age, as set out in the following table: [TABLE] [TR] [TD]Date of Birth[/TD] [TD]Preservation Age[/TD] [/TR] [TR] [TD]Up to 30 June 1960[/TD] [TD]55[/TD] [/TR] [TR] [TD]From 1 July 1960 to 30 June 1961[/TD] [TD]56[/TD] [/TR] [TR] [TD]From 1 July 1961 to 30 June 1962[/TD] [TD]57[/TD] [/TR] [TR] [TD]From 1 July 1962 to 30 June 1963[/TD] [TD]58[/TD] [/TR] [TR] [TD]From 1 July 1963 to 30 June 1964[/TD] [TD]59[/TD] [/TR] [TR] [TD]From 1 July 1964 onwards[/TD] [TD]60[/TD] [/TR] [/TABLE] So you may be able to access the funds is transferred at age 57/58? (not sure what month you were born in), if retired then 100% is allowable if not retired then potentially up to 10% each financial year. Note also though that although the UK are allowing full flexibility on defined accumulation pensions this has not yet been passed on to ROPS, therefore any withdrawal of more than 25%/30% as a lump sum could trigger an unauthorised payment charge of up to 55% if still within 5 full tax years of being a non UK tax resident. Regards Andy Quote Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted June 29, 2015 Share Posted June 29, 2015 What you are planning may leave you liable to Australian tax I suspect. Are you intending drawdown on the work pension as if so I would check the position with the pension provider (via your HR Officer perhaps) to find out what drawdown restrictions may be in place. Are you expecting to retire in Australia as you may have better options? I am 55 in October and have just opened a SiPP and am in the process of moving my work pension fund into it. I then plan to open a Super Fund and transfer via a QROP to the Super fund. Yes, I have to wait until I am 60 to draw it - though no bad thing - but then 100% of drawdown is tax free and not 25%. Hi David 1: See preservation age table above. 2: So long as you are outside of the 5 full UK tax years (see above (also generally you will need to be retired from the workforce also if under age 65 for 100% access)). Andy Quote Link to comment Share on other sites More sharing options...
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