Frequently Asked QuestionsQ. Are transfers to overseas pension schemes authorised payments?
A. Yes – provided they are transfers to a Qualified Recognised Overseas Pension Scheme (QROPS).Q. Can the overseas QROPS make payments to members that would be deemed unauthorised in the United Kingdom?
A. Although legally possible, in practise it would not happen as the member would be exposed to a 55% income tax charge and the Scheme would risk losing its QROPS status.Q. How long does it take to transfer my pension?
A. This depends on the speed at which the UK pension scheme manager operates and whether there are any complications. In our experience, from the date at which you apply for a transfer to the money being received in New Zealand takes around 10-16 weeks but this could be longer with some UK pension providers.Q. How much can I gain access to if I transfer my funds to the Britannia Retirement Scheme?
A. Your funds will be transferred to the Scheme based in New Zealand, meaning there should be no UK taxes payable upon exit from the United Kingdom. Once the funds are transferred into the Scheme, and provided you are 55 years or older, you can receive benefits (withdraw money) flexibly in line with your requirements.Q. How much does it cost me to transfer my pension?
A. The amount it costs depends on the service you consider best meets your needs. Currently we offer three services:-
- Electronic - designed for those who have a sound understanding about UK pensions, the pros and cons of transferring their pension and which investment choice(s) meet their needs. Also, for those who only want information to be supplied electronically.
- Standard - designed for those who need access to 'easy to understand' information which would enable them to make a more informed decision as to whether to transfer their pension.
- Premium - designed for those wanting personalised financial advice to help them decide whether or not it is in their best interests to transfer their pension and if so, what investment fund(s) within the Britannia Retirement Scheme would meet their needs.
For the Electronic and Standard services the following fees will be agreed with you before you transfer to the Scheme:
- A Contribution Fee of up to 2.5% to cover administrative costs associated with the transfer.
- Financial Adviser Fees.
For the Premium service, in addition to the above fee, there is a Statement of Advice fee which generally varies between NZ$500 - NZ$1,800 plus GST, depending on the level of advice required.
Once invested in the Britannia Retirement Scheme other fees also apply. See the Product Disclosure Statement for a description.Q. I've misplaced the details of my UK Pension. How can I find out if I have a UK Pension?
A. Try the UK Government site click here. This Pension Tracing Service can help you find a lost pension.Q. If I transfer my UK pension fund balance to the Britannia Retirement Scheme who manages those funds for me?
A. Transferred funds invested in the Scheme are managed by Britannia Financial Services Limited, the Manager, who use specialist underlying investment managers. You select the fund(s), which have different risk profiles and expected returns, from Cash Enhanced, Moderate, Balanced through to Growth in which your account balance is reinvested.Q. I'm now living overseas. Why can't I simply apply to my pension provider to cash up my UK pension?
A. You can do but you are likely to need to pay New Zealand tax at your marginal rate as the New Zealand Inland Revenue Department deem this to be a receipt of overseas income. There is potentially some relief for this although this is a complex area of tax and you should consult a tax advisor.Q. In what circumstances can funds be released to members of New Zealand pension schemes?
A. Most New Zealand QROPS schemes allow the tax-free release of at least some of your savings under the following circumstances:
- Attaining normal minimum retirement age (currently 55 years of age).
- Serious illness or injury (medical evidence must be provided).
- Death before retirement.
- Transfer to another QROPS.
A. No UK tax is payable if the transfer is to a QROPS. Such transfers are authorised payments. It is unlikely that a transfer to a non-qualifying overseas scheme would proceed because of the extreme tax penalties. An unauthorised payment charge of 55% would be levied and the exporting scheme would also be liable for a further 40% penalty charge. There is however, potentially NZ tax payable on the receipt of pension amounts into NZ. After four years, an increasing amount of tax is payable on any transfer in from the UK.Q. What can be transferred?
A. Pensions we can transfer:-
- Retirement Annuities.
- Personal pensions including National Insurance contracted-out plans.
- Stakeholder plans.
- Executive Pension Plans.
- Section 32 buy-out bonds.
- Occupational schemes and attached AVC accounts.
- Self-invested schemes – NOTE: we cannot accommodate a transfer of the scheme's investments.
- Residual fund balances associated with pensions in payment, which are in capped drawdown or flexi-access drawdown.
- In addition, Britannia has special arrangements in place to transfer 131 type contracts from Jersey - and locked-in plans domiciled in any country within the European Union.
A. If you decide to leave New Zealand within 5 years of the date of transfer of you pension out of the UK, there may be tax consequences. You should discuss these with your adviser.Q. What is a Qualifying Recognised Overseas Pension Scheme (QROPS)?
A. A QROPS is an overseas scheme which has been recognised by HMRC to accept transfers from United Kingdom Registered Pension Schemes.Q. Why would I want to transfer my pension to New Zealand and what are the disadvantages?
A. We have provided details of some potential advantages and disadvantages on the page 'Should you move your pension to New Zealand?'