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UK Transfer Pension

UK Transfer Pension

Old Sep 28th 2014, 1:13 pm
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Default UK Transfer Pension

Hi,
Just wondering whether anyone can explain whether it's worth me transferring my UK pension over to Ozz. About 20 years of UK pension to bring over.
I understand that I will be taxed if I transfer after 2014.
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Old Sep 29th 2014, 12:56 pm
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Default Re: UK Transfer Pension

Hi,

If you are planning to retire outside of the UK you are far better off looking at a scheme called a QROPS which stands for qualified recognized overseas pension scheme. Its far more tax efficient than moving your UK pensions in to Oz.

Take a look at this link from the HMRC website that underlines some of the benefits. I hope the link is useful.

HM Revenue & Customs: Transferring your pension

Last edited by christmasoompa; Sep 29th 2014 at 1:20 pm.
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Old Sep 30th 2014, 7:57 am
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Default Re: UK Transfer Pension

I looked at transferring my pension over but decided against it.
QROPS is just a series of rules that any compiling pension scheme anywhere in the world must comply with if your pension is to be transferred tax free. These rules apply for 10 years after the transfer and can be really restricting and so potentially expensive admin wise. A lot of Oz pension providers are QROPS compliant you just have to ask them.

I'm now drawing my UK private pension tax free from the UK but it is liable for tax in Oz but as I have a $18,200 tax free allowance I've structured my finances to pay little or no tax by transferring my assets into super.
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Old Sep 30th 2014, 3:43 pm
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Default Re: UK Transfer Pension

Originally Posted by Kiwipaul View Post
I looked at transferring my pension over but decided against it.
QROPS is just a series of rules that any compiling pension scheme anywhere in the world must comply with if your pension is to be transferred tax free. These rules apply for 10 years after the transfer and can be really restricting and so potentially expensive admin wise. A lot of Oz pension providers are QROPS compliant you just have to ask them.

I'm now drawing my UK private pension tax free from the UK but it is liable for tax in Oz but as I have a $18,200 tax free allowance I've structured my finances to pay little or no tax by transferring my assets into super.
That's interesting. Are you saying that you get the first $18,200 tax free and anything over that you transfer into your super which means you get it all tax free?
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Old Oct 1st 2014, 1:26 am
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Default Re: UK Transfer Pension

Originally Posted by paulry View Post
That's interesting. Are you saying that you get the first $18,200 tax free and anything over that you transfer into your super which means you get it all tax free?
I have a tax free allowance of $18,200 like everyone else and the next $20,000 is taxed at 19c and so I can earn $37,000 and only pay $3572 tax. Providing you are under 66 you can transfer $180,000 (capital) into super each year. If I earn more than $37,000 I can transfer it into super (up to $35,000 per year) as a pre tax contribution (It's taxed at 15% on going into super).

The super rules here are incredibly generous you just need to understand them.

I don't worry about transferring any income into super unless it above $37,000 as I would only save 4c in the $.
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Old Oct 2nd 2014, 2:30 am
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Default Re: UK Transfer Pension

Everyone's situation is different - Yes you can Transfer funds over into your OZ super. When it is converted into a pension it is tax free and earnings are tax free. You also negate the UK inheritance tax of 40%. UK pension Rules are proposed to change from April 2015.

More detail information on the process and proposed changes can be found within my sponsored forum at the bottom of the main page: Link is in signature block as well as:
UK Pension Transfers, Home Loans and Financial Advice - British Expats

I hope that helps a bit. cheers
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Old Oct 2nd 2014, 11:15 am
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Default Re: UK Transfer Pension

Originally Posted by Kiwipaul View Post
I have a tax free allowance of $18,200 like everyone else and the next $20,000 is taxed at 19c and so I can earn $37,000 and only pay $3572 tax. Providing you are under 66 you can transfer $180,000 (capital) into super each year. If I earn more than $37,000 I can transfer it into super (up to $35,000 per year) as a pre tax contribution (It's taxed at 15% on going into super).

The super rules here are incredibly generous you just need to understand them.

I don't worry about transferring any income into super unless it above $37,000 as I would only save 4c in the $.
Thanks Paul, I'll keep this in mind
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Old Oct 4th 2014, 3:51 am
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Default Re: UK Transfer Pension

Originally Posted by john in oz View Post
Everyone's situation is different - Yes you can Transfer funds over into your OZ super. When it is converted into a pension it is tax free and earnings are tax free. You also negate the UK inheritance tax of 40%. UK pension Rules are proposed to change from April 2015.

Really? A pension is an income stream, how does inheritance tax come into the picture?

Just wondering whether anyone can explain whether it's worth me transferring my UK pension over to Ozz. About 20 years of UK pension to bring over.
It's often best to leave it in place and simply draw on the pension when it's paid. However, depends on facts/circumstances.
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Old Oct 4th 2014, 4:05 am
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Default Re: UK Transfer Pension

Current death Tax is 55% on pensions - current proposed changes will see this reduce to the same rate as inheritance tax of 40%.
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Old Oct 4th 2014, 4:14 am
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Default Re: UK Transfer Pension

Originally Posted by john in oz View Post
Current death Tax is 55% on pensions - current proposed changes will see this reduce to the same rate as inheritance tax of 40%.
So this is the special income tax charge on certain lump sum death benefit distributions from pensions:
https://www.gov.uk/tax-on-pension-death-benefits
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Old Oct 4th 2014, 4:38 am
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Default Re: UK Transfer Pension

The following link explains in better detail the different circumstances of the various taxes that may apply to someone who dies or is terminally ill whilst receiving a pension. The may be subject to a current tax of 55% of the fund value depending on the type of fund they have and the type of payment made or being received.

Suffice to say in response to the original question that you need to be aware that you may be subject to a TAX on death of up to 55% and this should be just one of your considerations when determining whether or Not to Transfer a UK pension out of the UK.


HM Revenue & Customs: Tax on a pension you pass on or inherit
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