CathnPaul

Can someone tell us in laymans terms the following:

1. When do we start looking into what to do with our current works pensions.
2. What is the best thing to do with it ie cash it in/transfer it over - approx 20yrs service in it for one and 5yrs for the other.
3. Tax implications (if any) without directing us to a mega heavy website.
4. what questions do i need to be asking others/companys??

I have read other threads on here and they are all above my head... if someone could start the basic info ball rolling?? we are looking at leaving the UK approx Jan next year by the way.

Cheers

Bix

Well mate, the good news is you don't have to panic about it because even if you wanted to transfer your pensions the time is not right.

On 6 April the UK government brought in new laws on pensions. Without going into too much detail it means from that date overseas funds have to apply for approval by the UK. It's referred to as QROPS approval and means they have to comply with a lot of things including feeding back information as to how your pension is performing.

So far we have heard of no Aus Super funds that are definitely going for the QROPS but one or two have said they might. Only time will tell.

If you transfer your pension to a non QROPS approved scheme the UK will take 40% tax......yes 40% !!

So in a nutshell it's not worth considering a transfer until there are QROPS approved funds. (if there ever are any)

My advice then is to just keep reading any pension threads that come along as they will eventually help you to get a better understanding of it. In the meantime you know you are losing nothing.

CathnPaul

Bix..superb advice mate and in a sensible language. Cheers

galloping gaijin

Be interesting for people to post if they know of any scheme that will comply...

We're in the process of moving and were told by BT that they weren't accepting any UK pensions until September - probably after they have put the reporting processes in place.
...but I can't find any other companies, looks as if it will be too expensive for them.

Wol

Except that I believe the ATO takes a rather large chunk intax if you don't transfer within IIRC six months of becoming tax resident.

Rocks and hard places?

MartinLuther

It's not that large. It's 15% of any profit that has been made since the owner became tax-resident. A lot smaller than 40% of the whole fund.

OzTennis

There's also the thought that company pensions left in the UK are becoming increasingly shaky as final salary schemes are closed left, right and centre and most funds have enormous shortfalls or so called 'black holes'. Robert Maxwell seems to have got at most funds from his watery grave!

OzTennis

Gill C

Contact Simon Barwick at Vantage Financial in Brisbane. PH.3229 5750 he dealt with our pension transfers. To the best of our knowledge although the situation is still a little fluid so long as the money is being transfered into a recognised/approved scheme there is no tax liability (we paid Mr Brown nothing) Good luck

CathnPaul

Cheers for that Gill...hubby was told the same from his work but with the recent changes need to look a little closer into it. will give him a ring through. Nice one.

Bix

Gill, the UK law changed on 6 April 2006.

As long as money is transferred into a (QROPS) approved scheme you are right there is no UK tax liability.............but there are currently no Aus approved schemes.

But as mentioned above from the time you become resident you have 6 months grace to transfer it free of Aus tax. Thereafter it will be taxed by 15% but only on the growth. For example if you transferred it after 10 months of becoming resident you would be liable to pay tax on the growth over the previous 4 months. (Probably small fry)

CathnPaul

Bix how did you find out there were no QROPS approved schemes??

Reading this thread and further investigation we are managing to get our head around it all now by the way.

Pauls works are adamant there are QROPS schemes in australia and are looking for the info to send us...we shall see what they come up with and post it on the thread if it materializes.

CathnPaul

http://www.advance.com.au/resources/...uk_changes.pdf --------- this info link may explain one or two things further. I was told to also look at the pensions schemes through banks.

Paul

Bix

Hi Cath.

No schemes could apply until after the 6th April as there was no means for them to do so and I believe no full details as to what was required of them.
That's only 16 days ago.
How quickly can the funds determine if they can and do want to apply ? How quickly will the HMRC grant approval ?

I don't know the answer but we are dealing with large financial institutions and government here so when was that ever quick ? Hope I am wrong.

I suspect Paul's people have got it wrong in some way.
There might be a lot of funds that could potentially qualify but will they apply / have they ?

If there are already QROPS approved funds out there then there are a lot of people on here who would be interested so please let us know what they come up with.

Auzziebound

If there are already QROPS approved funds out there then there are a lot of people on here who would be interested so please let us know what they come up with.[/QUOTE]


Me being one of them.

Jane

CathnPaul

Me being one of them.

Jane[/QUOTE]

Of course we will post them...likewise with everyone else.

Paul has done a lot of research now and has clicked with it all...so am leaving it up to him. He explained it the same as you Bix... he reckons work wont come up with any companies either.