Go Back  British Expats > Living & Moving Abroad > New Zealand
Reload this Page >

British retirement pension

British retirement pension

Old Jan 15th 2007, 12:53 am
  #1  
Forum Regular
Thread Starter
 
tom's mum's Avatar
 
Joined: Apr 2003
Location: Cambridge, New Zealand
Posts: 83
tom's mum will become famous soon enoughtom's mum will become famous soon enough
Default British retirement pension

Help please, my parents are seriously contemplating emigrating to New Zealand. We have been here three years and their chance of gaining residency is not an issue. However they are rightly concerned about whether their pension will be taxed. I have searched the threads here and some say they wont get taxed and some dont say anything. The IRD website has stated they will be taxed at a rate of 19.5%. This seems very unfair when they dont get taxed in the UK. After all dad worked very hard and paid tax all his life. Can someone please tell me how they stand?
tom's mum is offline  
Old Jan 15th 2007, 2:39 am
  #2  
JAJ
Retired
 
JAJ's Avatar
 
Joined: Apr 2004
Posts: 34,649
JAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond repute
Default Re: British retirement pension

Originally Posted by tom's mum View Post
. I have searched the threads here and some say they wont get taxed and some dont say anything. The IRD website has stated they will be taxed at a rate of 19.5%. This seems very unfair when they dont get taxed in the UK. After all dad worked very hard and paid tax all his life.
Are you sure they "don't get taxed" in the UK? Is it their only source of income?
JAJ is offline  
Old Jan 15th 2007, 4:24 am
  #3  
Forum Regular
Thread Starter
 
tom's mum's Avatar
 
Joined: Apr 2003
Location: Cambridge, New Zealand
Posts: 83
tom's mum will become famous soon enoughtom's mum will become famous soon enough
Default Re: British retirement pension

No the pension from the government is not taxed, he does have a very small private pension which is taxed but the state benefit pension is not taxed at all.
tom's mum is offline  
Old Jan 15th 2007, 4:39 am
  #4  
BE Forum Addict
 
Joined: Feb 2005
Location: Back in NZ & loving it - living in Orewa
Posts: 1,183
lapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond reputelapsed kiwi has a reputation beyond repute
Default Re: British retirement pension

The difference is, there's a personal tax-free allowance in UK but not in NZ, so when you're a NZ taxpayer, you pay tax on all income. One of the factors to consider when considering a move, and a reason to vote for a lower tax government once you're a citizen.
lapsed kiwi is offline  
Old Jan 15th 2007, 5:03 am
  #5  
Account Closed
 
Joined: Dec 2005
Posts: 527
Apple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of lightApple12 is a glorious beacon of light
Default Re: British retirement pension

Originally Posted by tom's mum View Post
After all dad worked very hard and paid tax all his life.
But not in NZ he didn't
Apple12 is offline  
Old Jan 15th 2007, 5:14 am
  #6  
Forum Regular
Thread Starter
 
tom's mum's Avatar
 
Joined: Apr 2003
Location: Cambridge, New Zealand
Posts: 83
tom's mum will become famous soon enoughtom's mum will become famous soon enough
Default Re: British retirement pension

True, he hasnt done a days work here or he would be paying with even more taxes like i do now. However it obviously impacts on their decision to come over when he will lose a lot of his pension to the tax man.
tom's mum is offline  
Old Jan 15th 2007, 8:18 am
  #7  
BE Enthusiast
 
Joined: Nov 2004
Posts: 311
ukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really nice
Default Re: British retirement pension

My grandfather had his old age pension and forces pension wired to NZ - not sure if it was taxed or not. I'd ask him but he died 6 months ago.
ukkiwi is offline  
Old Jan 15th 2007, 7:55 pm
  #8  
Melbourne Australia
 
thebears's Avatar
 
Joined: Feb 2006
Posts: 4,169
thebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond reputethebears has a reputation beyond repute
Default Re: British retirement pension

Originally Posted by tom's mum View Post
Help please, my parents are seriously contemplating emigrating to New Zealand. We have been here three years and their chance of gaining residency is not an issue. However they are rightly concerned about whether their pension will be taxed. I have searched the threads here and some say they wont get taxed and some dont say anything. The IRD website has stated they will be taxed at a rate of 19.5%. This seems very unfair when they dont get taxed in the UK. After all dad worked very hard and paid tax all his life. Can someone please tell me how they stand?
If the pension is sufficient to attract a high level of tax then you can afford to get sufficient tax planning advice.

If its not - it should not be attracting enough tax to be worried about.
thebears is offline  
Old Jan 16th 2007, 7:21 am
  #9  
Just Joined
 
Joined: Jun 2006
Posts: 20
Steve Horrell will become famous soon enough
Default Re: British retirement pension

Originally Posted by tom's mum View Post
Help please, my parents are seriously contemplating emigrating to New Zealand. We have been here three years and their chance of gaining residency is not an issue. However they are rightly concerned about whether their pension will be taxed. I have searched the threads here and some say they wont get taxed and some dont say anything. The IRD website has stated they will be taxed at a rate of 19.5%. This seems very unfair when they dont get taxed in the UK. After all dad worked very hard and paid tax all his life. Can someone please tell me how they stand?
My military pension from the UK is taxed at 39% yet it is paid by the UK Govt for time served in the forces, but NZ take the tax from it. I spent 8 months fighting the IRD but at the end of the day, the simple rule is that ALL overseas income must be declared and you cannot chose where your income will be taxed given that you are resident in NZ, and are subsequently liable under NZ taxation laws. You can still have a UK tax code allocated against your pension but if there is a difference on what you are taxed in UK (if any) and what is taxable in NZ then the NZ govt will take their share. Bloody unfair I say as they are taxing money paid out by another country but I dread to think of the consequences if I simply ignore the IRD and get found out some years down the line!!!!
Steve Horrell is offline  
Old Jan 16th 2007, 8:27 am
  #10  
BE Forum Addict
 
helinuk's Avatar
 
Joined: Aug 2003
Location: latitude 37
Posts: 2,389
helinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond reputehelinuk has a reputation beyond repute
Default Re: British retirement pension

Is there any way you can keep the pension in a uk or off shore account and use a UK credit card in NZ- to avoid NZ tax on pension?
helinuk is offline  
Old Jan 18th 2007, 1:27 am
  #11  
Forum Regular
Thread Starter
 
tom's mum's Avatar
 
Joined: Apr 2003
Location: Cambridge, New Zealand
Posts: 83
tom's mum will become famous soon enoughtom's mum will become famous soon enough
Default Re: British retirement pension

Originally Posted by helinuk View Post
Is there any way you can keep the pension in a uk or off shore account and use a UK credit card in NZ- to avoid NZ tax on pension?
We did think about this but wonder about the consequences. Has anyone else tried it and either got away with it or didn't
tom's mum is offline  
Old Jan 18th 2007, 1:34 am
  #12  
JAJ
Retired
 
JAJ's Avatar
 
Joined: Apr 2004
Posts: 34,649
JAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond repute
Default Re: British retirement pension

Originally Posted by helinuk View Post
Is there any way you can keep the pension in a uk or off shore account and use a UK credit card in NZ- to avoid NZ tax on pension?
If you live in a country that taxes worldwide income, that is illegal tax evasion.
JAJ is offline  
Old Jan 18th 2007, 1:42 am
  #13  
Forum Regular
Thread Starter
 
tom's mum's Avatar
 
Joined: Apr 2003
Location: Cambridge, New Zealand
Posts: 83
tom's mum will become famous soon enoughtom's mum will become famous soon enough
Default Re: British retirement pension

Originally Posted by JAJ View Post
If you live in a country that taxes worldwide income, that is illegal tax evasion.

We did think that keeping your pension overseas would be seen as fraud of some kind. Having said that i do know of some who keep their UK bank account.
tom's mum is offline  
Old Jan 18th 2007, 1:44 am
  #14  
JAJ
Retired
 
JAJ's Avatar
 
Joined: Apr 2004
Posts: 34,649
JAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond reputeJAJ has a reputation beyond repute
Default Re: British retirement pension

Originally Posted by tom's mum View Post
We did think that keeping your pension overseas would be seen as fraud of some kind. Having said that i do know of some who keep their UK bank account.
It's not illegal or even fraudulent to leave funds overseas. There are no exchange controls in New Zealand.

However, income tax obligations must be complied with regardless.
JAJ is offline  
Old Jan 18th 2007, 5:33 am
  #15  
Just Joined
 
Joined: Jun 2006
Posts: 20
Steve Horrell will become famous soon enough
Default Re: British retirement pension

Originally Posted by helinuk View Post
Is there any way you can keep the pension in a uk or off shore account and use a UK credit card in NZ- to avoid NZ tax on pension?
Tried all that and got absolutely nowhere!! The answer is to either not declare and run the risk of the NZ and UK tax departments talking to each other (which they are quite entitled to do under the double taxation agreement) so as not to pay tax in NZ or, front up with the truth and pay the tax. I know I didn't want to get stung with a huge tax bill and a fine for tax evasion so did the latter!
Steve Horrell is offline  

Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.