Financial Services. To use, or not to use?
Apr 20th 2004, 6:37 am
#1
Forum Regular
Thread Starter
Joined: Apr 2003
Location: Essex U.K.
Posts: 34
Financial Services. To use, or not to use?
We are now in the process of getting quotes from removal companies to ship our stuff to Aus. No problems so far as I have seen lots of info on this site regarding the various companies out there worth using! A great help.
But, has anyone who has completed the move to Aus, or only a few months away (like us) any info relating to financial planners? I made contact with a few financial consultants at the Sandown show who have raised many questions relating to pensions, endowments, taxes etc…
Have you used, or do you intend to use a financial consultant to help with this part of the move? Is it worth it?
Austen
But, has anyone who has completed the move to Aus, or only a few months away (like us) any info relating to financial planners? I made contact with a few financial consultants at the Sandown show who have raised many questions relating to pensions, endowments, taxes etc…
Have you used, or do you intend to use a financial consultant to help with this part of the move? Is it worth it?
Austen
Apr 20th 2004, 6:41 am
#2
BE Enthusiast
Joined: Jul 2003
Location: Westleigh, Sydney
Posts: 553
You don’t need a financial planner to do anything related to your move. You may have to do some basic research and legwork, but unless you have particularly complex financial affairs, there is nothing you can’t do yourself. You will probably derive much more satisfaction from doing it yourself anyway.
If you have specific questions, ask away.
If you have specific questions, ask away.
Apr 20th 2004, 6:53 am
#3
Forum Regular
Joined: Apr 2003
Location: Waikiki Perth originally Bournemouth in Dorset
Posts: 79
Gordon
I have a couple of private pensions which don't seem to be worth much at the moment so I was thinking of just freezing and leaving them here and then accessing them from oz when the time comes - is this possible.
I also have a secured(think thats the right name) pension which guarantees a set pension which goes up a percentage each year. Again hoping to keep that here.
It seems to me that if I was to move it over the companies are going to want to take a slice of it straight away and they're not worth that much anyway.
If I freeze the private pensions will their value go up if the shares markets go up or do they freeze at current values?
All seems a bit confusing.
One of my pensions was advising foing back into serps. Ihaven't bothered as I'm, hopefully leaving this year but again I don't know if it would be worth going back into it for a few months before I go.
Any advice would be greatly appreciated.
Cheers
Gazza
I have a couple of private pensions which don't seem to be worth much at the moment so I was thinking of just freezing and leaving them here and then accessing them from oz when the time comes - is this possible.
I also have a secured(think thats the right name) pension which guarantees a set pension which goes up a percentage each year. Again hoping to keep that here.
It seems to me that if I was to move it over the companies are going to want to take a slice of it straight away and they're not worth that much anyway.
If I freeze the private pensions will their value go up if the shares markets go up or do they freeze at current values?
All seems a bit confusing.
One of my pensions was advising foing back into serps. Ihaven't bothered as I'm, hopefully leaving this year but again I don't know if it would be worth going back into it for a few months before I go.
Any advice would be greatly appreciated.
Cheers
Gazza
Apr 20th 2004, 6:59 am
#4
Keeping Busy
Joined: Feb 2004
Location: East of Eden?
Posts: 1,215
Good question.. I don't have the answer!!
It seems a bit like trying to decide whether to use an agent or not for the visa app.
Initially we thought we would use an agent as the paperwork looked quite daunting but our situation is fairly straight forward and we would have to do the donkey-work anyway so we're doing that part of it ourselves.
Still indecided about the financial advisor side of things, but probably will use one having saved a wad by doing the visa ourselves.
It really depends on how complicated your finances are. It's quite easy to find out info about the UK side of things but until recently (from coments on this site and following the Sandown Exhibition) didn't realise about the benefits of transferring pensions within 6-months - if you are going to transfer them. I'm still not clear if that's within 6m of validation or becoming an Aus resident for tax reasons but we're some way off looking fully into that at the moment.
If you decide to use someone I think it's best to get the ball rolling asap as Pension Trustees are notoriously slow at dealing with such stuff as transferring individual pension pots.
Keep us posted!
Good Luck
It seems a bit like trying to decide whether to use an agent or not for the visa app.
Initially we thought we would use an agent as the paperwork looked quite daunting but our situation is fairly straight forward and we would have to do the donkey-work anyway so we're doing that part of it ourselves.
Still indecided about the financial advisor side of things, but probably will use one having saved a wad by doing the visa ourselves.
It really depends on how complicated your finances are. It's quite easy to find out info about the UK side of things but until recently (from coments on this site and following the Sandown Exhibition) didn't realise about the benefits of transferring pensions within 6-months - if you are going to transfer them. I'm still not clear if that's within 6m of validation or becoming an Aus resident for tax reasons but we're some way off looking fully into that at the moment.
If you decide to use someone I think it's best to get the ball rolling asap as Pension Trustees are notoriously slow at dealing with such stuff as transferring individual pension pots.
Keep us posted!
Good Luck
Apr 20th 2004, 7:03 am
#5
Forum Regular
Joined: Apr 2003
Location: Waikiki Perth originally Bournemouth in Dorset
Posts: 79
Arnie
I think its 6 months from becoming oz tax resident not validation.
Cheers
Gazza
I think its 6 months from becoming oz tax resident not validation.
Cheers
Gazza
Apr 20th 2004, 7:51 pm
#6
Forum Regular
Joined: Apr 2003
Location: Waikiki Perth originally Bournemouth in Dorset
Posts: 79
Any info anyone?
Apr 22nd 2004, 6:34 am
#7
Forum Regular
Joined: Apr 2003
Location: Waikiki Perth originally Bournemouth in Dorset
Posts: 79
Gordon
Have you got any Pearls of wisdom?
If you have specific questions, ask away. [/QUOTE]
Have you got any Pearls of wisdom?
If you have specific questions, ask away. [/QUOTE]
Apr 22nd 2004, 6:44 am
#8
BE Enthusiast
Joined: Jul 2003
Location: Westleigh, Sydney
Posts: 553
For us, it just seemed simpler to consolidate all our UK pensions and transfer them over. Freezing your pension in the UK is probably fine, but you do run an exchange rate risk regardless of how they perform.
Just keeping track of the UK pension funds and notifying them of any change of address seemed like too much work.
I am also not sure on the tax situation when you start to draw on then, and whether you would have to purchase an annuity in the UK with the proceeds.
My advice would be that if you intend to retire to Oz, and have about 20+ years of contributions still to make then transfer the lot over.
Also, even if you have a final salary scheme, you would have to have served a lot of years before making it worthwhile to keep in the UK. Remember that a final salary scheme pays a percentage of your leaving salary. Even adjusting for indexation, our was sod all.
Just keeping track of the UK pension funds and notifying them of any change of address seemed like too much work.
I am also not sure on the tax situation when you start to draw on then, and whether you would have to purchase an annuity in the UK with the proceeds.
My advice would be that if you intend to retire to Oz, and have about 20+ years of contributions still to make then transfer the lot over.
Also, even if you have a final salary scheme, you would have to have served a lot of years before making it worthwhile to keep in the UK. Remember that a final salary scheme pays a percentage of your leaving salary. Even adjusting for indexation, our was sod all.
Apr 27th 2004, 6:45 am
#9
Just Joined
Joined: Apr 2004
Posts: 16
There are new rules that are looking to apply from July 04 if they pass through parliment in Australia. I have prepared these transferred before for clients and it doesn't seem that difficult, just the paperwork is the hassle and picking the right fund in Australia.
The Australian system is very tax concessional in retirment compared to receiving the income source from the UK (which you can do if you wish).
1. If you transfer your pension to the Australian system immediately (6 month rule), the amount comes over as tax paid. The benefit of this is that in retirement you will get this back tax free through a private pension system. In addition to this tax free payment from the pension, you will receive 15% tax rebate on additional monies drawn, therefore minimising tax in retirement. It is a little more in depth than this but this is not the forum to go through the whole pension legislation in Australia.
2. If you leave the money in the UK, you can still get a pension payment in retirment but you will be assessed in Australia as if you are receiving a wage, so taxed at normal rates without concession.
Note: Once you transfer your funds to the Australian superannuation system, you can't get a pension from that source and you can't access your funds until retirement. You can change providers, just not taken out of the system.
On the transfer side, if you go direct to a product provider, they will change you anything from 3-5% entry fee. This can be pretty cheap. We can reduce this down for you by just putting our licence details on it, we will get paid by the product provider on an ongoing basis, not an extra fee, already built into the product. There is over 10,000 products to choose from in Australia, so we try to utilise one with choice and flexibility.
If you can get the transfer paperwork from the UK provider, then you have done most of the hard work.
I have attached a document which outlines the new rules proposed.
Regards
George Caredes
[email protected]
The Australian system is very tax concessional in retirment compared to receiving the income source from the UK (which you can do if you wish).
1. If you transfer your pension to the Australian system immediately (6 month rule), the amount comes over as tax paid. The benefit of this is that in retirement you will get this back tax free through a private pension system. In addition to this tax free payment from the pension, you will receive 15% tax rebate on additional monies drawn, therefore minimising tax in retirement. It is a little more in depth than this but this is not the forum to go through the whole pension legislation in Australia.
2. If you leave the money in the UK, you can still get a pension payment in retirment but you will be assessed in Australia as if you are receiving a wage, so taxed at normal rates without concession.
Note: Once you transfer your funds to the Australian superannuation system, you can't get a pension from that source and you can't access your funds until retirement. You can change providers, just not taken out of the system.
On the transfer side, if you go direct to a product provider, they will change you anything from 3-5% entry fee. This can be pretty cheap. We can reduce this down for you by just putting our licence details on it, we will get paid by the product provider on an ongoing basis, not an extra fee, already built into the product. There is over 10,000 products to choose from in Australia, so we try to utilise one with choice and flexibility.
If you can get the transfer paperwork from the UK provider, then you have done most of the hard work.
I have attached a document which outlines the new rules proposed.
Regards
George Caredes
[email protected]
