billy

I have heard that after migrating to Australia on a permanent resident visa one is liable to pay australian income tax on certain investments left behind in the UK. These may include ISAs, PEPs, and even pensions and endowment policies !!! How cruel is that !!

These are tax free in the UK for very good reasons. I cannot believe how unjust it would be to be taxed on the growth in an endowment or pension that you don't have access to for another 30-40 years.

My question is - How will the Australian tax authorities know that these exist if you don't declare them ?

Has anyone here migrated to Australia and still held these investments in the UK ? If so, then how did you manage the tax situation ?

billy

Sorry to boing this message back to the top of the list but it's really bugging me and if anyone could find time to mention their own experience it would be much appreciated.

I'm seriously considering an application to migrate but this taxation thing is worrying me. I have a significant amount of tax free holdings such as pensions, PEPs, endowments, life assurance etc in the UK. These are basically for my retirement days and I have already paid heaps of tax on my contributions to them through PAYE (with the exception of the pensions). Do I really have to pay Australian income tax on the growth of these investments even though I cannot withdraw from them to pay that tax ?

If I decide to migrate I will consult a tax advisor but I want to get a rough idea of whether it is worth taking that expensive route in the first place.

Many thanks
Billy

Sandra

We spent a long time with a tax advisor and consider it money well spent - but bottom line is the taxation laws in Australia do not offer the same taxable strategy as the UK. So we are being advised to sell the endowments, organise and arrange the best transfer of pension fund within six months of migration. There was lots of information about the best way of managing the money but none on methods of tax avoidance (which would be basically illegal). If you leave the money here and don't declare it - how would you get the money into the country later when the policies mature?

There are financial advisors linked to some of the migration people who answer on this site. I would suggest you contact them direct about your individual circumstances. Many offer an initial session at reasonable prices.

Good Luck

Alan Collett

Billy,

I endorse what Sandra has said.

Mail me directly if you want to discuss your position more fully.

Alan Collett alan-at-collettandco-dot-com www.collettandco.com

billy wrote in message <[email protected]>... Sorry to boing this message
back to the top of the list but it's really bugging me and if anyone could find time
to mention their own experience it would be much appreciated.

I'm seriously considering an application to migrate but this taxation thing is
worrying me. I have a significant amount of tax free holdings such as pensions, PEPs,
endowments, life assurance etc in the UK. These are basically for my retirement days
and I have already paid heaps of tax on my contributions to them through PAYE (with
the exception of the pensions). Do I really have to pay Australian income tax on the
growth of these investments even though I cannot withdraw from them to pay that tax ?

If I decide to migrate I will consult a tax advisor but I want to get a rough idea of
whether it is worth taking that expensive route in the first place.

Many thanks Billy

--
Sandra

Sandra

Glenn

Posted via http://britishexpats.com

ndaltonb

Hi Billy,

I know, it's rough but different countries, different rules. As our tax advisor said "Drink Australian, Think Australian". Personally as we are not intending to return to the UK, like Sandra, we are cashing in all the PEP's, ISA's Endowments etc and transferring pensons asap. It was gtreat when we sold the endowment and sent a fat cheque to the mortgage company. I now own half my house!!

Once we get to Aus we will invest the way the Aussies do.

One good thing we picked up at Migrate was that buying shares for capital growth doesn't seem so good as there seems to be little tax incentive and it's better to go for shares with good divvies.

Differnt country, different rules.

Hope it works OK for you.

Nigel db

Pread

Nigel,

Pension: that's something I'll need to sort out sooner or later. I have about 11
years pension from 2 different banks I worked for in London, and I'll start up a
pension in OZ. Any idea if I should be doing something with the pension before I
leave, or can I do it from there ? Other pension 'specialists' I've spoken to in the
past are more concerned with getting you to make additional payments through them
than consolidating your existing pension contributions...

Cheers, Paul.

"ndaltonb" <[email protected]> wrote in message
news:[email protected]...
    > Hi Billy,
    >
    > I know, it's rough but different countries, different rules. As our tax advisor
    > said "Drink Australian, Think Australian". Personally as we are not intending to
    > return to the UK, like Sandra, we are cashing in all the PEP's, ISA's Endowments
    > etc and transferring pensons asap. It was gtreat when we sold the endowment and
    > sent a fat cheque to the mortgage company. I now own half my house!!
    >
    > Once we get to Aus we will invest the way the Aussies do.
    >
    > One good thing we picked up at Migrate was that buying shares for capital growth
    > doesn't seem so good as there seems to be little tax incentive and it's better to
    > go for shares with good divvies.
    >
    > Differnt country, different rules.
    >
    > Hope it works OK for you.
    >
    > Nigel db
    >
    >
    >
    > --
    > ndaltonb
    >
    > lizzie
    >
    > Posted via http://britishexpats.com

ndaltonb

Hi Paul,

We are jointly moving 3 pension across and have decided to sort it all out before we go.

Up front, we are using Geraint of Montfort International. Geraint is doing the investigation work here and has a handover with a recommended financial advisor in Aus. He sends the reports on the pensions to the Aus advisor and then they pick it up from there.

The key thing is that you have a window of about 6 months to move the pensions across TAX FREE (I THINK. Any experts please confirm/deny).

Not too sure what you mean by "more concerned with getting you to make additional payments through them than consolidating your existing pension contributions"

Are you going over permanently, if so I'd personly recommend to get the ball rolling before you leave.

I have Geraints contact details if you need them.

Best regards

Nigel db

Chris

Nigel

We have some experience with Montfort International.

They tend to make a rather simple process complicated and bamboozles you with jargon.

At the time there was a link up with Tower in Australia and advisers with Godfrey
Pembroke in Australia.

Halfway through the transfer process Montfort decided they no longer wanted to Deal
with Tower or Godfrey Pembroke.

Everything came to a halt and Montfort would not tell my Australian advisers why
except Tower no longer complies.

I have since had my UK pensions transferred by Godfrey Pembroke(some 18 months later
I might add-no fault of Godfrey Pembroke)

So much for six months!!!

The tax issue is something to be wary of but it is not as big an issue as is made out
I can't go into details here as I don't really understand it but have found my
Australian Advisers Godfrey Pembroke have a good understanding of the whole process.

In the process I found out that the rules changed in the UK in April 2001. The Fund
Montfort uses in Austrlia is mirrored on UK rules (not a requirement)in fact the
funds may go to any reputable superannuation fund in Australia. Montfort will tell
you different.

I have been told the Australian Fund Montfort uses has high entry fees but not having
used it I can't confirm. Also when I asked people over here about it no one had even
heard of the company running it.

In the end I paid alot of money to Montfort for what I consider poor service and
questionable advice.

Seeking advice before leaving didn't save me money or time. If I had my time over
again I would have contacted Australian Advisers up front and organise transfer from
Australia. Less stress and hassle I think.

Suggest you shop around. Australian advisers seem prepared to give initial advice
free. This allows you to decide if you are comfortable with them I am happy to
recommend the services of Godfrey Pembroke send me an email and I will give you some
contact details.

Regards

Chris

ndaltonb <[email protected]> wrote in message
news:<[email protected]>...
    > Pread wrote:
    > > Nigel, Pension: I have about 11 years pension from 2 different banks I worked
    > > for in London, and I'll start up a pension in OZ. Any idea if I should be doing
    > > something with the pension before I leave, or can I do it from there ? Other
    > > pension 'specialists' I've spoken to in the past are more concerned with
    > > getting you to make additional payments through them than consolidating your
    > > existing pension contributions... Cheers, Paul.
    >
    > Hi Paul,
    >
    > We are jointly moving 3 pension across and have decided to sort it all out
    > before we go.
    >
    > Up front, we are using Geraint of Montfort International. Geraint is doing the
    > investigation work here and has a handover with a recommended financial advisor in
    > Aus. He sends the reports on the pensions to the Aus advisor and then they pick it
    > up from there.
    >
    > The key thing is that you have a window of about 6 months to move the pensions
    > across TAX FREE (I THINK. Any experts please confirm/deny).
    >
    > Not too sure what you mean by "more concerned with getting you to make additional
    > payments through them than consolidating your existing pension contributions"
    >
    > Are you going over permanently, if so I'd personly recommend to get the ball
    > rolling before you leave.
    >
    > I have Geraints contact details if you need them.
    >
    > Best regards
    >
    > Nigel db

ndaltonb

Hi Chris,

Could you send me their contact details and I hope they are in Melbourne. My e-mail is [email protected]

Many thanks

Nigel db

timsorrell

if anyone is interested in another recommendation, my financial adviser here in Brisbane used to also be my financial adviser in the UK 5 years ago and I definitely recommend him. I arranged everything over here and he handled transfer of pensions, provided various helpful recommendations etc and obviously knows hows to handle financial matters in both countries! Sometimes UK pensions companies make it awkward to transfer overseas, and he has handled this for many expats from the UK. So please let me know if you want contact details.
Tim Sorrell http://emigrate.hotshopping.com.au

dugongs

get myself into trouble for saying this and it is definately not the correct thing to do but as somebody with nothing left in uk :

dont declare them, have the funds paid into an offshore account in jersey and draw the funds out with an atm card.

probably going to get blasted for saying that but the options there if people want to take the risk.

Alan Collett

I really wouldn't be so sure of not being found out these days, what with the
pressures being brought on the offshore tax havens (including Jersey) by the others
(including the UK and Australia) to disclose information ...

Alan C www.gomatilda.com

dugongs wrote in message <[email protected]>... get myself into trouble
for saying this and it is definately not the correct thing to do but as somebody with
nothing left in uk :

dont declare them, have the funds paid into an offshore account in jersey and draw
the funds out with an atm card.

probably going to get blasted for saying that but the options there if people want to
take the risk.

--
Posted via http://britishexpats.com

dugongs

yes true, but cant see it happening any time soon. the main focus has always and will always be more on rogue states and launderers.

i think it more likely that in the not to distant future oz will relax these draconian rules on foreign investments. Oz is dragging itself into the globalised world and is slowly changing outdated taxation rules i.e. the recent changes to the 5 year rule for foreign execs.

David Ford

Take great care, always ask for a breakdown of ALL fees and get a second opinion if you have any concerns.

It is a complicated subject and you do need advice from both a UK and Australian persepective, but it is not as hard as some people have been told.

rudo1ph

Sorry to bring this topic back after so long..................

OK, So I have a PEP, my husband and I jointly have an ISA and my husband has an endowment policy in the UK :scared:

What should we do!!!!!? With the stock market so flat I am a bit loathe to cash them in - do I have any other option though?

Any advice gratfully received

Rudi