68MEVY

Right we've looked in to the pension situation like we said we would on another thread.
The info we've been given by our local pension office is basically that we may aswell not bother to do anything with our UK pension and forget about it as anything we're entitled to will be deducted from ay state pension accumulated in Oz.

Surely that can't be right, can it?

I don't know a great deal about pensions but from what I can gather, the more you pay in the more you get out.

If we'd paid 35 years worth of NI in the UK we'd get a 'normal' pension, however if we paid 15 years in the UK and 20 years in Oz, they apparently deduct the UK from the Oz and leave us with a crap pension.

Is someone having us on or is this really what happens?

Any info greatly recieved

Marie

Storini

I am not an expert on this subject, but I believe the problem is that the two systems are operated on different principles. The UK pension depends on making a sufficient number of contributions, and is then granted irrespective of other income. The Oz pension is available to all citizens irrespective of contributions but is means-tested and if you have significant income or assets will be reduced accordingly. So, the UK pension will be counted against the Oz pension which would be reduced: not the other way round.

So, I would expect you should keep up the UK NI contributions to become eligible, but make private superannuation provision in Oz.

JAJ

I'm not sure if it's a good idea to keep up UK NI once you are in Australia - do the sums and work out the pros and cons of 'investing' this way as opposed to the alternatives.


Jeremy

Ialibu

Also check out another neat little feature. If you migrate to the US, your UK Pension is indexed and rises. If you migrate to Australia, it ain't!!! No amount of lobbying etc over the past 20 years has fixed that anomaly.

As I said, check it out.

JAJ

On the other hand you'll probably pay a lot more for healthcare in the US. Plus, it's not so easy to get a migrant visa.

Also - private and company pensions from the UK are *not* frozen.

After 10 years residence in Australia you are eligible for an Australian state pension, however this is means tested (unlike UK). So it's swings and roundabouts.

Jeremy

Trekrider

I thought that the idea of superannuation in Oz was that you could choose how it was invested and depending on how well your chosen investment went depended on how much you actually got. This implies that there is no means testing. What would be the point in choosing how to invest the money if at the end of the day what you got depended on how much other money/income you actually had.

Trekrider

Storini

We were talking about the pension provided by the state, not private pension arrangements (superannuation) which are as you say.

The Oz state pension should be seen as more like UK Income Support I think.

Trekrider

Sorry, showing my ignorance here, I thought superannuation was the state pension and was compulsory. Thanks for clearing that one up.

Trekrider

kirsty&al

The Oz state pension and Super are 2 different things. The Oz state pension is similar to UK social security, in that it is paid only to those that need it. So the better provision you make through super (or UK NI payments) then the less "state pension" you get. However, to be fair to those that do provide for their own retirement income, it is not a $ for $ swap. People on low income will get a full pension, but over a certain threshold, every $ you make does not reduce your pension by a $, it reduces it by a smaller amount, until the point where you don't get a pension.

As someone said above it is a different system. The UK system is a govt run savings scheme, where as the Oz system is a "gift of the state" (just like social security is a "gift of the state" in the UK).

A

Paylia

As you said 20 years lobbying - and a test case recently taken to the Law Lords failed, and there is now a possibility of it finding its way to Brussels - Human Rights Commissioners. for those interested in what is being done ( and said) have a look here:

http://www.independentretirees.com/
http://www.britishpensions.org.au/

Who knows what may happen - but it could affect your UK pension received in Oz in years to come.

Trekrider

Thanks for clearing that up for me, I'll stop worrying now

Trekrider

kirsty&al

You're welcome Next time I wont bother

Quokka

That's not true. The Uk pension is treated as normal income and taxed. Last time I checked 40% is deducted if you have an Aussie state pension.

Trekrider

I'm sorry I seem to have offended you, I'm not sure why - I was only thanking you for explaining the difference between state pension and superannuation.

Trekrider

kirsty&al

Sorry, I took the at the end as a piss take rather than just

No worries
A