0nlyme

Thanks chc4me, I have been getting some great info from your posts.

I have a £20k pension in the UK from when I worked 2006-2011.

I left the UK Sept 2011, and it is held by an investment service. I arrived back in NZ in Dec 2011 and worked until Feb 2014. I have just moved to Australia, but I have not started to work here yet. I plan to live here for a few years.

I understand with upcoming tax law changes it worthwhile transferring this to my KiwiSaver. Can I do this if I am not an NZ resident?

Thanks,

0nlyme

chc4me

Hi, Thanks for your post. You will need to seek specific advice as your situation is more complex than most. I take it that you are originally from NZ, left in 2006 for 5 years before returning to NZ in 2011 and then moved to Australia. That's 3 sets of rules and tax obligations that you need to consider, and beyond the scope of a general answer.

RachelG12

Sorry if I missed it, this thread is getting long.

So, with the new tax rules, does the 4 years for transient residents still apply? We moved here April 2013, my NHS pension is still in the UK. I now pay into a Kiwisaver scheme at work. I was always planning on transferring it within the 4 years. Only just heard about this from a colleague today. Panic stations!!

Thanks

Rachel

0nlyme

Thanks for the quick reply. You're right - I am from NZ originally.

Sounds complex. Do you have any recommendations on who I can seek specific advice from?

Cheers, 0nlyme

chc4me

Good points Rachel. I thought I would ask the Moderators to close this thread early next week for a number of reasons; a) while most of the discussions have remained on topic, it's now quite long and difficult to find the info b) Once the 1 April deadline has passed, this thread becomes redundant c) I though a new thread out lining the rules applicable from 1 April would be more beneficial. I just have not had anytime to sit down and write that new summary .... but will do.

To answer your question, no need to panic, the 4 year exemption still applies for new migrants and returning Kiwis. The 4 years start from the day you become NZ Tax Resident which is usually the first day of arrival in the Country. Make sure you leave enough time to complete the transfer within the 4 year exemption. Some transfer can take 3 to 6 months or even longer depending on the pension company. Factors that unusually delay a transfer include a change in the method of calculating the transfer value or a delay in service from the pension company. As an example, early last year the NHS stopped producing transfer statements while a change in calculating the value was organised. It took 5 months just for the NHS to restart this process and transfers were generally completing after 8 months.

Regards
chc4me.

BEVS

Yes. Contact chc4me

He is only able to give general guidance here. For specific professional advice you need to contact Dai direct. He will have a disclosure statement etc and once you are with him, he is allowed to advise in his full capacity.

He has a contact link at the bottom of his posts

You can also find him HERE

Can you all please not deluge him with general queries now please. This thread seems to suffice for that and Dai is happy to help here where he can.
Also it wouldn't be fair unless you are serious about utilising his professional services.

BEVS

Okey Dokey Dai.

Noted.

I'll close it on Monday .

It's been one heck of a thread .

RachelG12

Thanks so much for that. Much appreciated. Do you know if the same rules apply for money transfers e.g. from a house sale?

BEVS

No. It does not include money from house sales.

However, if you sold a house and then earned interest on that money for a while before transferring the funds, then that interest is NZ taxable.

All income is taxable.

House sale proceeds are not taxable.

chc4me

Thanks Bev. I'll type up a summary of the new rules for the benefit of all.

chc4me

Slightly off topic but though this might be of interest. Talking with a client last week, the client said the IRD contacted him and was conducting an audit because the NZ IRD had found out that he had money in a bank account in the UK from a house sale, had earned interest in the bank and therefore should have declared this interest in NZ. I have since heard that the NZ IRD had requested bulk information from the UK and is checking a number of areas.

Also heard (but not confirmed) that the IRD have sent letters to new migrants once their 4 years finish to ask for declaration of overseas investments.

All expats should be aware of their tax obligations. A visit to an accountant (and maybe a cost of $500) to find out what your obligations are is far better than an audit, penalties and past taxes issued by the IRD.

manni72

Just wanted to say thank you for your detailed reply to my question and apologies for re-energising this thread It's great to have your contact details...that was going to be my next question. I had an idea I needed a new advisor. Looks like I may have found one

Reylan

Does anyone know how the UK budget decisions affect the benefits of transferring?

chc4me

Likely to be minimal impact. All of the benefits for transferring a pension to NZ remain and have not changed. The UK Budget introduces the option to withdraw some or all pension savings at retirement and this benefit is expected to flow through to overseas schemes that accept transfers.

If the funds are left in the UK and then withdrawn in full at retirement, as suggested in the budget, then tax would be payable in NZ. This is because NZ taxes worldwide income (as do most countries around the world).

If the funds are transferred to NZ, a one time tax is payable now with no further tax on withdrawals from the scheme.

plent2d

Is it not the case that NZ changed the rules here a while back so that only 30% of the transfer can be taken at retirement (65 in NZ) and that the remainder 'has' to be used to generate an income for life and so effectively reduces your pension pot every year. Whereas the NHS pension, and maybe others, allow a lump sum which does not reduce the pension pot at all and in fact is increased every year to take into account of inflation?

Because of these reasons i cannot see many reasons to transfer other than to reduce tax.