Anyone get financial advice before moving?
 

Just wondering if anyone got any advice with regards to pensions etc before making the move to Oz, and if you did, a) was it worth paying out for? b) can you recommend a company that does this?

Regards.

J.

Re: Anyone get financial advice before moving?
 

We forked out about £3000 for financial advise from a company in England called Montfort. They ae based in Surry. We were promised that we would save at leadt £40,000. It was a sham so Caviat Emptor!!!!!

Re: Anyone get financial advice before moving?
 

I asked a similar question months ago. From memory I got zero response :D

Re: Anyone get financial advice before moving?
 

Whether to obtain financial advice or not really comes down to your circumstances. I'd suggest that if you are selling up and taking all your money with you to Oz, and you don't have any pension, then financial advice may not be so critical compared to someone who is keeping UK investments/property and has one or more pensions.

Pensions (Superannuations) in Oz are generally more flexible than current UK ones, however you generally get taxed 3 times.. On money going in (~15%) on gain in value (~15%) and when taking the money out. However if you transfer your UK pensions over to Oz then it can be tax beneficial as the money is considered tax paid (even though in the UK it isn't!). It is quite a complex area and well worth researching, especially if you decide to do a Self-Managed Super.

One of the key points about pensions is whether to transfer them or not. If you do then there is a SIX month window from when you arrive in Oz in which to transfer the pension, otherwise you will suffer a tax penalty when you do transfer. (I believe the legislation may be changing to increase theis window of time in which you can transfer). If you do NOT transfer your pensions then you could well find yourself having to pay Oz tax each and every year on the increase in value of your pension fund, even if you are not taking money out. i.e. this could be for the next 30 or so years if you are say 30 years old!!

Hence if you have a reasonable pension pot the choices you make on whether to transfer or not could drastically affect the value of it!

Other areas where it is useful to know the rules (check on the ATO website) is to do with bank accounts, investments and life policies.

If you keep some of your money in a high interest UK bank account then you won't get taxed on the interest if the account was opened before 1st July 2003. This can be quite useful if you are receiving a decent interest rate.

(see ATO website or http://www.gomatilda.com/news/article.cfm?articleid=327)

Note: The only place the 6 month window applies is for Pensions transfer. You will see some people mistakenly believing that it also applies to transfering your money to Oz. It doesn't!

With respect to keeping other UK investments e.g. stocks, shares, ISAs, PEPs, Life Policies then things get a bit more complex. So long as the total value is less than $50,000 between your family then these are generally not taxable. If they are greater than $50,000 then they are taxable. Best to go to the ATO website and do a search for "FIF" you will find a large document that explains how it all works.

As for who to use, from a search of the forums you will find some companies have a poor reputation (e.g. Montfort) while others have a more positive reputation (e.g. Prism Xpat).

No I'm not a financial adviser, I have just been researching the topic myself, and it makes me :zzz: and :beer: !

Hope that helps
:rolleyes:
Alex

Re: Anyone get financial advice before moving?
 

Think I made a slight mistake, the point above about the bank accounts being opened prior to July 2003 should I believe refer to the fact that you won't have a tax liability when you transfer the money to Oz, based on exchange rate fluctuations rather than not having a tax liability with respect to interest earned.
i.e. the interest earned is probably taxed
the gain/loss from the change in exchange rate from when you migrate to when you bring the money over is not taxed.

hope that helps.
:eek:
alex

Re: Anyone get financial advice before moving?
 

Alex - yes it does and thanks for taking time to reply.
Richard

Re: Anyone get financial advice before moving?
 

You are a star! Should have read this before posting myself. Please PM me if you can recommend who we use to help us through this as we have one very good pension, plus 3 less good pensions, plus equity from our house in the bank.
Tara

Re: Anyone get financial advice before moving?
 

Tara,

Haven't used anyone myself however my parents saw both Montfort and Prism and they found Gerraint from Montfort did a massive hard sell on them which they disliked while Darrien from Prism was helpful and more sensibly priced.

From doing a search on the forum Montfort generally does not do well! Best thing to do is a search for "Montfort" and then you will find the others mentioned as well in the same posts.

glad my post helped

alex :cool:

Re: Anyone get financial advice before moving?
 

Alex,

Thanks for your reply :) , lots of really useful information for me to research and think about.

J.

Re: Anyone get financial advice before moving?
 

No worries :o

good luck !

:-)

alex

Re: Anyone get financial advice before moving?
 

With respect to transferring pensions, its worth considering if you may possibly return to the UK in years to come. If there is a chance then it may be better to leave it where it is.

Re: Anyone get financial advice before moving?
 

[QUOTE=Alex Hall]
One of the key points about pensions is whether to transfer them or not. If you do then there is a SIX month window from when you arrive in Oz in which to transfer the pension, otherwise you will suffer a tax penalty when you do transfer. (I believe the legislation may be changing to increase theis window of time in which you can transfer). If you do NOT transfer your pensions then you could well find yourself having to pay Oz tax each and every year on the increase in value of your pension fund, even if you are not taking money out. i.e. this could be for the next 30 or so years if you are say 30 years old!!

Hi Alex,

Can you tell me whether the 'double taxation agreement between UK & Oz' that you fill in from Inland Revenue (which state that you can avoid being taxed twice on your pensions), applies to occupational pensions as well as state pension??? I'm a bit confused reading them. :confused:

I have the forms ready to complete - but I don't really know exactly what they apply to.

Also, do you know if the 'double taxation agreement' has a time limit, coz it doesn't appear to from the forms?? So I can only presume that once you complete them, that you won't be taxed again on your Uk pensions by Oz at any time that you wish to transfer, or when you start claiming your pension at retirement age???

Cheers

Shell

Re: Anyone get financial advice before moving?
 

This is a posting I submitted to another thread, which might be of interest ...

I have heard of apparently large sums of money being charged too. However, would you pay GBP3,000 for advice that saved you GBP100,000 ... or maybe saved you somewhat less? For some (most?) that might be money well spent.

I tend to agree with Jeremy's comments about final salary schemes, although I have heard that some companies are changing the basis on which the pension arising from such schemes will be paid (I recall seeing a 1/60th scheme changing to a 1/100th scheme recently). When you throw the complexity of the taxation of pensions paid to an Aussie tax resident from a UK policy compared with the taxation of a transferred pension into the mix, add in the transferability of benefits to a surviving spouse/partner, and factor in the vagaries of exchange rates a number of years hence I'm not surprised some put the issue into the "too hard basket".

However, my view is that taking advice is a must, not least because doing nothing can give rise to an avoidable tax liability.

I (and/or my financial planning colleagues) will be happy to help if persons affected would like to complete their details here (excuse the piccie!):
http://www.collettandco.com/contact.cfm

Best regards.

Re: Anyone get financial advice before moving?
 

Shell,

What is your status insofar as your pensions are concerned? If you are in receipt of income from your pension the Tax Treaty provisions apply. If your UK funds haven't been commuted into an annuity the Treaty provisions don't affect you; rather you need to consider Australia's Foreign Investment Fund Rules and what is commonly known as section 27CAA (which have been described above) ... if you're still not sure what these provisions are all about or whether they apply to you I'd suggest you may need to take some professional advice.

Best regards.



[QUOTE=shecha]

Re: Anyone get financial advice before moving?
 

All,
There is another factor about taking advice. When you talk to an agent find out who they are regulated by (eg the Financial Services Authority in the UK or the equivalent in Aus - if in the UK you can look them up on the FSA website). If in the unfortunate event (and one would hope unlikely) event that you are mis-advised then you will have the right to complain and seek redress. If you are dissatsified with the way that your complaint has been dealt with then you can refer to the Financial Services Ombudsman (in the uK). Therefore going down the advisor route does give you some form of redress whereas DIY leaves you H&D (high and dry!!!).

Make sure you ask your advisor obvious questions; what experience do you have - how long have you been in the industry, how long have you been authorised to give fin advice? What financial areas are they authorised to give advice on (not all advisors are authorised to advise on all things)? What qualifications do you have? What charges do you make? What level of service will they provide you for your money? Are they independent or tied to one insurance company? If they are "independent" how many insurance companies are on their panel?

A good advisor will be asking you lots of personal questions so that they can give you the right advice. You should ask them lots of questions before they begin - if you don't get satisfactory answers then look elsewhere. You have a lot at stake. The FSA website gives a lot of tips to consumers.
Richard