cheshire-cat

from the centrelink website, you have to apply for your uk pension before you get your oz pension, then 40 cents will be deducted from the oz pension for every dollar you get from the uk

carzinoz

Hiya,

Thanks, that confirms something I read on this website http://youle.info/bpia-blog/?page_id=11 which said for every $100 from the UK pension, your Oz pension will be reduced by $40, leaving you $60 better off.

I was trying to understand the thresholds for qualifying for the Oz pension. If I'm reading it right it looks like you'd have to be living on baked beans in a shed to qualify. Mabye I better concentrate on saving in to a super fund.

Would anyone care to comment on supers for the self employed and government co-contributions? I'm trying to get to grip with the various aspects of our finances and at the moment it's throwing up more questions than answers.

Grayling

I was wrong then....I thought it was pound for pound

You will also have to pay australian tax on your UK pension so the amount you actually recieve will be much lower

Mazza12

So I'm moving to Oz in August having made NI contributions for 21 years. I hope to work in Oz for at least another 18 years. Given that I'll be taxed on my UK state pension when I reach retirement age while living in Oz, does anyone know how I can work out if it is worth continuing to make NI contributions in the UK? I know the easy option would be to get a financial advisor but trying to avoid this expense.

lesleys

You get a pension forecast for your existing contributions.
You work out how another 9 years of voluntary contributions will cost you.
YOU decide if it's worth it to get the full UK pension when you qualify.

All the links

http://www.britishpensions.org.au/portal.htm

Mazza12

Thanks so much for this lesleys

carzinoz

it's a gamble isn't it? Without having a crystal ball to see how long you'll live you can't know whether it's going to be worth it or not. There's a useful website here

https://www.moneysmart.gov.au/tools-...rement-planner

which gives you an idea of how far your Oz private and state pension is going to go.

We're in the same position...continue paying in to the UK state pension or use that money to buy more Oz private pension. I'd be interested to hear any conclusions you come to.

Mazza12

Thanks Carzinoz, that link looks like it will be very useful I plan to request all the paperwork ie UK state pension forecast (based on 21/30ths) and then look at the difference based on an additional 9 years of NI contributions. Then weigh this up against using the money as you suggest to pay into a private pension fund in Oz. I'll request an occupational pension forecast (teacher and education adviser) and use my crystal ball to predict my Oz occupational pension (assuming I manage to secure a job and not knowing what that will be - just to complicate matters). Then work out whether to transfer my occupational pension to Oz within 6 months - again a bit of a gamble! I'll then work out what my Oz state pension is likely to be after living in Oz for 22 years (with at least 18 years of work) at retirement. Then I'll do some very big and complicated sums before reaching my conclusion. God my head hurts just thinking about it! I'll let you know.

lesleys

Don't rush to transfer it! Make sure you want to stay in Oz first.

The Oz state pension is not automatic. It is means tested and if you have reasonable super and UK pensions you will be unlikely to get any.

Mazza12

I know that if I transfer my occupational pension to Oz and then decided to return to the UK that I would be unable to do so but I'm also worried about tax implications if I leave it in the UK and then decide to transfer it at a later date. I'm so ignorant about all of this and am trying to get up to speed with it all. I appreciate your help.

Grayling

Be very careful and get proper advice if you are thinking of transferring a final salary scheme.....you are usually better off leaving it where it is.

carzinoz

That is such good advice! We're four years in Oz but I'm glad we kept our UK state contribs going, it keeps that option open in case you want to return.

Seems to me that you would need to be on a low income before the Oz state pension kicks in and it's better to plan to pay your own way because I think you are expected to "rearrange your affairs" to support yourself if you have income and assets above the qualifying limits. I'm taking that to mean you might have to sell a nice house and buy somewhere smaller and use the excess to generate income.

Have you stopped working in the UK yet? The reason I ask is because if you work up until the final week before leaving the UK you can apply to pay class 2 voluntary NI contribs, if you stop work more than a week beforehand you have to pay class 3 which is heaps more expensive than class 2. Wish we'd known that before we came!

Mazza12

No I plan to stop work on August 10th and we fly out to Oz on August 20th, however if changing my finishing date to 13th would make a difference re class 2 or 3 I would do this. I plan to phone the helpline this week to ask about this. Having done some calculations, based on paying Class 3 contributions for 9 years, I worked out that I would be approx $18 per week better off (after Oz 40 cents in the $1 tax) when I retire at 66. I would have to live to 75 for this to have been worth it. Who knows??????

carzinoz

Definately check it out! Not working up till the last week was the reason they gave for my hubby not qualifying for class 2.

I wrote to them a couple of weeks ago to say he's now done almost four years continuous work in Oz so can he now pay class 2 instead of class 3, still waiting to find out.

PS: I'm planning on living till 100

Mazza12

I just called the DWP in Newcastle and spoke to an international case worker re the Class 2 or 3 Voluntary NICs. He said that in the past a person was required to, for example, stop working in the UK on the Friday and start work abroad on the Monday but he said this has been relaxed as they realise in most cases this is impractical. I specifically told him of my intention to stop work 10 days before leaving the UK and explained that I hadn't secured work in Oz yet. He said that once securing work in Oz I should complete form CF83and tick the Class 2 option and then they will decide but he couldn't see any reason why I wouldn't be allowed to pay Class 2 as long as I have work history in the UK. I asked, under what circumstance would I be required to pay Class 3 and he said that this is really for people who are not working.

PS you just want your telegram from the Queen