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New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Old Aug 2nd 2012, 3:30 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

I have read this post with great interest & have lived in many countries the last few years.

In NZ I always thought you had to declare all your income & assets in NZ (Shares, Insurance Proceeds, Inheritances, & compensation for injury) & then you had to declare the same for any of the above that you held or derived overseas including Pension Schemes. At least that is what I remember on filling out my annual income tax return.

When we lived in Spain we had to declare all of our world wide income & assets & was taxed accordingly.

So don't understand how pension funds are tax free. If you were told that do any of you have it in writing? Also do not understand how a UK advisor can decide the taxation rules that apply to New Zealand. It is up to New Zealand to implement their own tax laws.

I am not having a go at any of you but I fail to see it as posted here. If that was the case I should not have to pay tax on my meagre pension.

I have to pay tax on my Australian Age Pension & because I live in New Zealand the pension is paid at a reduced rate. When I lived in Cyprus it was paid at 100% & not taxed.
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Old Aug 2nd 2012, 3:49 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Just found this

http://www.ird.govt.nz/international/nzwithos/income/
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Old Aug 2nd 2012, 3:49 am
  #108  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Aucklander
I have read this post with great interest & have lived in many countries the last few years.

In NZ I always thought you had to declare all your income & assets in NZ (Shares, Insurance Proceeds, Inheritances, & compensation for injury) & then you had to declare the same for any of the above that you held or derived overseas including Pension Schemes. At least that is what I remember on filling out my annual income tax return.

When we lived in Spain we had to declare all of our world wide income & assets & was taxed accordingly.

So don't understand how pension funds are tax free. If you were told that do any of you have it in writing? Also do not understand how a UK advisor can decide the taxation rules that apply to New Zealand. It is up to New Zealand to implement their own tax laws.

I am not having a go at any of you but I fail to see it as posted here. If that was the case I should not have to pay tax on my meagre pension.

I have to pay tax on my Australian Age Pension & because I live in New Zealand the pension is paid at a reduced rate. When I lived in Cyprus it was paid at 100% & not taxed.
I too have asked about inheritances as Kate and I have had both a living inheritance and one from a death. Neither are NZ taxable, again I have in the past contacted the IRD and in both cases (from the death of my aunt to the donation from Kates very alive dad) no tax is due. Would be very unfair if it was taxable as there is NO death duty in NZ from what I can understand and gift taxation only goes as far as kiwi national/residents gifting NZ cash or assets and not gifts outside NZ. Re the inheritances the only tax we do pay is on the interest of the capital.
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Old Aug 2nd 2012, 3:56 am
  #109  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Aucklander
I have read this post with great interest & have lived in many countries the last few years.

In NZ I always thought you had to declare all your income & assets in NZ (Shares, Insurance Proceeds, Inheritances, & compensation for injury) & then you had to declare the same for any of the above that you held or derived overseas including Pension Schemes. At least that is what I remember on filling out my annual income tax return.

When we lived in Spain we had to declare all of our world wide income & assets & was taxed accordingly.

So don't understand how pension funds are tax free. If you were told that do any of you have it in writing? Also do not understand how a UK advisor can decide the taxation rules that apply to New Zealand. It is up to New Zealand to implement their own tax laws.

I am not having a go at any of you but I fail to see it as posted here. If that was the case I should not have to pay tax on my meagre pension.

I have to pay tax on my Australian Age Pension & because I live in New Zealand the pension is paid at a reduced rate. When I lived in Cyprus it was paid at 100% & not taxed.
Yes I do..here is what my NZ QROPs representative has written to me.

'You both left UK in April 2005 and started the Pension Transfers May 2010.



There was no tax to pay on transferring your pension to NZ then or now under current legislation .



The IRD have put a discussion document out only re FIF taxation regime where funds in a foreign Superannuation Scheme worth over $50,000 pounds can be assessed for a 5% capital gains tax each year.

This applies whether you transfer or not so the sooner one transfers the lesser the liability.



The longer you leave funds there the bigger the liability.

Britannia will be sending out a letter shortly after taking taxation advice so we should wait until then.

It’s only a discussion document that’s been circulated and it’s not law yet.'


Have no idea what the veracity is of what he has written but suffice to say he told us at the time it was all tax free. Was not/am not impressed with the performance of our QROPs co and they got a whole heap of cash for doing pretty much nought. Taken to the cleaners yet again. NZ appears to be chocca full of knobs.

Last edited by Genesis; Aug 2nd 2012 at 4:00 am.
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Old Aug 2nd 2012, 4:16 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Genesis
Yes I do..here is what my NZ QROPs representative has written to me.

'You both left UK in April 2005 and started the Pension Transfers May 2010.



There was no tax to pay on transferring your pension to NZ then or now under current legislation .



The IRD have put a discussion document out only re FIF taxation regime where funds in a foreign Superannuation Scheme worth over $50,000 pounds can be assessed for a 5% capital gains tax each year.

This applies whether you transfer or not so the sooner one transfers the lesser the liability.



The longer you leave funds there the bigger the liability.

Britannia will be sending out a letter shortly after taking taxation advice so we should wait until then.

It’s only a discussion document that’s been circulated and it’s not law yet.'


Have no idea what the veracity is of what he has written but suffice to say he told us at the time it was all tax free. Was not/am not impressed with the performance of our QROPs co and they got a whole heap of cash for doing pretty much nought. Taken to the cleaners yet again. NZ appears to be chocca full of knobs.
Not only NZ I am afraid all countries now are looking at ways they can raise revenue especially on anything that is not attracting tax presently.

Looking at the Australia website apparantly since 2004 they had a meeting in Washington DC between various countries & now exchange information, I read it recently & will try to find it & post the link.

I hear where you are coming from & despite what your NZ representative told you I am afraid if IRD introduce it noone has a leg to stand on.

You can protest all you like but I was always told "You can't fight City Hall"

I was deceived by self funded superannuation scheme in Australia several years ago & the only person that made any money out of it was the Investment Advisor of my bank. I lost plenty through their bungling & mismanagement & had the audacity to charge me extortionate fee on top of my losses.

But all countries are requesting information on all income & assets these days.
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Old Aug 2nd 2012, 4:27 am
  #111  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

A previous post mentioned deriving rent from a property in the UK & not declaring it.

If you read the following you will see you are obliged to declared overseas assets that are income producing. Afraid failure to do so will only make the situation worse & they will add fines & interest to undeclared income etc once they discover it.
http://www.ird.govt.nz/yoursituation...reign-inc.html
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Old Aug 2nd 2012, 4:29 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Aucklander
Not only NZ I am afraid all countries now are looking at ways they can raise revenue especially on anything that is not attracting tax presently.

Looking at the Australia website apparantly since 2004 they had a meeting in Washington DC between various countries & now exchange information, I read it recently & will try to find it & post the link.

I hear where you are coming from & despite what your NZ representative told you I am afraid if IRD introduce it noone has a leg to stand on.

You can protest all you like but I was always told "You can't fight City Hall"

I was deceived by self funded superannuation scheme in Australia several years ago & the only person that made any money out of it was the Investment Advisor of my bank. I lost plenty through their bungling & mismanagement & had the audacity to charge me extortionate fee on top of my losses.

But all countries are requesting information on all income & assets these days.
Indeed. The IRD can do what they like. If they deem we will have to pay tax on what WERE tax free QROP pension transfers they can and will do it. Does not stop those of us who wish to protest to do just that. Similarly as I understand there is no taxation on any inheritance given to you in or out of NZ, but they may change that too and retrospectively I have no doubt if they think they will get away with it. Life is a bitch on one or two or three........ occasions eh.
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Old Aug 2nd 2012, 4:32 am
  #113  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Personally I do not understand why people are getting so upset regard the government looking to collect tax from someone's income. Ok, it currently tax free, but the government must look at additional income streams.

Tax, it's a fact of life, we pay less in NZ than other countries and why should we not contribute to society?
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Old Aug 2nd 2012, 4:35 am
  #114  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Aucklander
A previous post mentioned deriving rent from a property in the UK & not declaring it.

If you read the following you will see you are obliged to declared overseas assets that are income producing. Afraid failure to do so will only make the situation worse & they will add fines & interest to undeclared income etc once they discover it.
http://www.ird.govt.nz/yoursituation...reign-inc.html
Trying to get away with what is due is not wise, especially as an immigrant from a moral stand point. Personally I think immigrants (like me) have a greater pressure on them than those born here to pay 100% what tax is due. Tax avoidance by legal means is fair game. Tax evasion leaves you open to expulsion one would assume. I will pay all my NZ taxes and many give me sideways glances when I say I declare it all and if in doubt I call the tax man. Honesty is the best policy. However when the IRD try to change what was agreEd when I took a transfer on is well out of order and I do not think they should be able to change something and then tax in a retro style. Bit like the police saying they have changed the speed to 40k's, told no one then issue a load of tickets..not really fair eh? If you don't know all the facts how can you make a good and fair and rational choice?

If they get away with this they are REALLY going to piss off a load of people and give NZ a bad name IMO.

Last edited by Genesis; Aug 2nd 2012 at 4:42 am.
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Old Aug 2nd 2012, 4:39 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Catchafire
Personally I do not understand why people are getting so upset regard the government looking to collect tax from someone's income. Ok, it currently tax free, but the government must look at additional income streams.

Tax, it's a fact of life, we pay less in NZ than other countries and why should we not contribute to society?
But not when you have bought into a scheme that WAS and IS tax free at present. To change the rules and then back tax is immoral IMO. To tax at a future date is fair enough then those wishing to go down the same route can make a decision with all the facts. We HAD all the facts they now want to change the facts we had a screw us. Shame on the IRD.
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Old Aug 2nd 2012, 4:48 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Genesis
Trying to get away with what is due is not wise, especially as an immigrant from a moral stand point. Personally I think immigrants (like me) have a greater pressure on them than those born here to pay 100% what tax is due. Tax avoidance by legal means is fair game. Tax evasion leaves you open to expulsion one would assume. I will pay all my NZ taxes and many give me sideways glances when I say I declare it all and if in doubt I call the tax man. Honesty is the best policy. However when the IRD try to change what was agreEd when I took a transfer on is well out of order and I do not think they should be able to change something and then tax in a retro style. Bit like the police saying they have changed the speed to 40k's, told no one then issue a load of tickets..not really fair eh? If you don't know all the facts how can you make a good and fair and rational choice?

If they get away with this they are REALLY going to piss off a load of people and give NZ a bad name IMO.
I just had a look at the ATO Australian Taxation website to see what the situation is there because some posters have mentioned they will move to Australia

http://www.ato.gov.au/individuals/co...01/002&st=&cy=

It's pretty lengthy, can put some to sleep but essentially think it says that overseas private pensions are subject to tax.

How do you think I feel NZ will let Australia pay it's old folk the full pension, & then NZ taxes the pension. Australia does not tax it's pensioners.

Guess all of us in NZ with some money have to keep those without money with an income & of course pay our politicians!
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Old Aug 2nd 2012, 4:52 am
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

[QUOTE=Catchafire;10205979

Tax, it's a fact of life, we pay less in NZ than other countries and why should we not contribute to society?[/QUOTE]

Really that's news to me & where do you get your facts?


Add the income tax you pay plus the GST added to every cent you spend plus the GST on the interest you earn

Then tell me what the TRUE % is

I think it is disgusting that healthy food is taxed

I think it is even more disgusting that everything else is taxed

Power Bills
Water
Insurance
Rates

When so many people can barely afford these things
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Old Aug 2nd 2012, 5:04 am
  #118  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Forgive me if you have posted this but on looking through the IRD website came across the following I thought I would share with you.



"Pension funds in the United Kingdom and the FIF rules

On 6 April 2006, the United Kingdom introduced the Qualifying Recognised Overseas Pension Scheme (QROPS). This scheme allows the transfer of UK pension funds to overseas providers that meet certain requirements.

The scheme might have an impact on New Zealand tax residents-significantly widening the tax implications if the underlying scheme rules allow a transfer of a pension to a QROPS.

The New Zealand foreign investment fund (FIF) rules explicitly cover rights to benefit from foreign superannuation schemes as a beneficiary or member. The FIF rules apply if the foreign superannuation fund is not exempt under the new resident's accrued superannuation entitlement exemption (section EX42 of the Income Tax Act 2007) or the non-resident's pension or annuity exemption (section EX43).

It's Inland Revenue's view that from 6 April 2006, the exemption from the FIF rules can't apply to resident investors to whom the de minimis doesn't apply; who aren't transitional residents and who have a beneficial interest in a UK pension scheme which will allow the transfer into a QROPS.1 All such investors have been required to account for income under the FIF regime since 6 April 2006, or since the 2006 - 07 income year.2

However, this won't apply if the individual scheme rules don't allow a transfer; impose significant "penalties" for transferring interests out of the UK scheme; or if there is a substantial decrease in the present value of any benefits on transfer to a QROPS.

In these scenarios, the beneficial interest in the UK pension scheme is exempt from the FIF rules. While there'll be no taxation before a distribution is made, the tax consequences of any potential transfer or subsequent pension payment will depend on the underlying nature of the pension scheme.

1 The exception would be if the fund could be transferred into a QROPS but only at a cost of a substantial decrease in the present value of the benefits, such as if the UK pension provider allowed the transfer but only at a substantial cost.

2 The former Grey List exemption, which applied until 31 March 2007, did not apply to an entitlement to benefit from a foreign superannuation scheme. These investments were always caught by the FIF rules."
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Old Aug 2nd 2012, 5:04 am
  #119  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Aucklander
Really that's news to me & where do you get your facts?


Add the income tax you pay plus the GST added to every cent you spend plus the GST on the interest you earn

Then tell me what the TRUE % is

I think it is disgusting that healthy food is taxed

I think it is even more disgusting that everything else is taxed

Power Bills
Water
Insurance
Rates

When so many people can barely afford these things
Makes me want to bring that thread to the fore 'NZ is a rip off' eh? It is a tin pot republic like I have always said. It is poorly run, poorly goverened and with too many shite laws. For me its only good points just now are that it is unpopulous, my kids have a great life here and Kate has a great job.

A large part of me wants to be somewhere else now but my needs are bottom of the pile and quite rightly so, as I dragged 'em all here in the 1st place. Some of what I say is a bit tongue in cheek but I do think NZ is very poorly run and poorly administrated place.
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Old Aug 2nd 2012, 5:05 am
  #120  
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Default Re: New Tax on non-NZ personal & occupation pension plans to hit migrants old and new

Originally Posted by Aucklander
Really that's news to me & where do you get your facts?
The Internet is always a good place to start.

http://en.wikipedia.org/wiki/List_of...s_by_tax_rates

Carry on.
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