I have a company pension, which my employer will not allow me to cash in!
They will however allow me to transfer it to a Canadian pension fund. Anyone know if a Canadian bank/insurance company will accept it? I'll be very annoid if I end up losing the cash!

Has anyone had any experience transfering pensions/insurance policies to Canada? Can it be done?

Will be interested to hear any answers as I will also be leaving a UK employer with a fair amount in the pension fund.

FWIW, my understanding is :

As far as I'm aware a pension is a pension and must be transferred to a new pension provider, or left where it is, until you reach the age of retirement. You can't cash it in early, at least not without incurring a vast tax penalty.

You can leave it in the UK and have them pay you from the UK after you reach the age of retirement (even if you're in Canada). This also applies to your UK state pension your NI contributions have paid into over the years.

I think there's some sort of tax break agreement between countries to allow this sort of thing to happen without being disadvantaged.

Personally, I was just going to leave it in the UK, either with my current company (who will retain it for me, if I want them to) or with another UK provider. If it's very easy and/or beneficial to have it moved to Canada then I'll consider that too.

Anyone?

Cheers, Iain

I was hoping I could've cashed it in and lived the life of Reilly with it for a few months! Alas, they refused and told me I'd have to leave it were it is, or transfer it to a Canadian fund if possible.

I presume it must be possible to transfer it to a Canadian fund. After all, what bank would want to refuse a few grand in sterling? I thought they would bite my hand off!

Has anyone had any experience transfering pensions/insurance policies to Canada? Can it be done? [/QUOTE]

I believe that if you've held the pension for less that 2 years then you are entitled to a refund of your contributions (less tax).

If you've held it for more than 2 years, then you should be able to either transfer it to a new scheme (if the trustees of the new scheme are prepared to accept it) AND if the trustees of the old scheme are happy with that.

I moved to Canada last year and am currently looking at options to transfer my UK pension to my Canadian RRSP.

A 'leading financial institution' told me that federal rules only allow the transfer of UK pensions to NON-locked in RRSPs (i.e. one you can access at any time - rather than a locked in RRSP which you can't access until retirement). This seems BIZARRE (my opinion only!) - and highly unlikely to be approved by the trustees of the UK fund. The transfer would be the 'cash value' of the pension - taxable by the UK, but offset by a Canadian tax credit (however, the Canadian tax credit may well be different to the UK tax paid).

The UK Inland Revenue sent me the following...

>The responsibility for the transfer of pensions lies with the
>trustees in the United Kingdom and all details of the transfer
>would be between the two companies involved. The Inland
>Revenue would hold no details of the transfer or monies
>involved.

>The Contracted Out Group would confirm whether or not
>company to which you are transferring your pension was
>government approved or not. If they need this information they
>should complete the form CA1890 which they should hold.
>
>Contracted Out Pensions Group, Benton Park View, Longbenton,
>Newcastle upon Tyne, NE98 1ZZ (0191 22 50180)

I haven't contacted them, but I thought I'd post it for info.

Bearing in mind the Inland Revenue comments above, I recommend contacting the trustees of the UK pension fund and asking them the question (I am waiting to hear back).

Note - none of the above is financial advice, just a brief summary of what I've been told...

HTH,
Peter

PS. On a related subject, check out the social security agreement between the UK and Canada. It's available from here:

http://www.dwp.gov.uk/lifeevent/bene...s.asp#azlisted

The interesting bit is this '...although UK State Pension and bereavement benefits are payable in Canada, you will not get annual increases in benefit once you have ceased to be ordinarily resident in Great Britain. This means that your benefit will stay at the same rate as when you left the UK, or when you first qualified for the benefit if you were already living in Canada at the time'.

(this applies to some countries, but not others)

Yes - it used to be tricky (UK Reveneue rules) but now it's quite simple to transfer pensions here. Both my wife and I have done so.

Basically, the UK Revenue, having given you tax free deductions for putting money in your pension hoped to eventually get it back when you retire and start drwing the cash - thus, if you move it over here they at least want to be sure you put into an "equivalent" scheme.

Trouble is that Canada doesn'y have strictly equivalent schemes. You need to set up a locked-in RRSP and then get your financial advisors who manage it for you to fill in a few forms guaranteeing that this is as close to a UK scheme as exists over here. Your UK people holding your funds probbaly have a set of forms to cover this - certainly companies like Friends Provident, Norwich Union etc do.

We used Investors group here to sort it out - this all quiote new stuff but they now have a set of standard letters etc that opne the doors in the UK.

So - there are a few hoops to jum through but it's all quite easy really.

We got our pensions transferred without the UK tax people taking a penny - straight out of our UK pension funds and into Canadian RRSPs

Thanks, that's good news! I've paid into my pension fund for 10 years so it's probably quite a sum by now.
Is there anyway I can transfer it into stocks and shares?

I do not know if there is a Canadian equivalent but if you leave it in the UK it is possible to transfer your funds into stocks and shares by transferring your pension fund into a SIPP. A SIPP is administered by a specialist provider (PPML or James Hay) and can usually be accessed through your existing pension provider.

No problem - an RRSP doesn't have to contain just mutual funds.

It's the UK that make the restrictions, not Canada, so it does have to be in an "equivallent" type of fund but RRSPs are pretty open ended about what you can shelter in there.

If you recently immigrated but intend to retire in Canada you can transfer your pension fund into a locked-in RRSP and let it grow tax free. All the steps necessary are set out in a free kit from http://www.transatlantictransfers.com You may avoid a tax liability too. I have heard that people who have contributed to a UK pension plan could be taxed in Canada on the money in their pension scheme even though they have no access to the funds until they retire.