NZ Tax Bill Introduced - UK Pensions
Mar 20th 2014, 8:23 am
#136
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Location: Auckland
Posts: 14
Re: NZ Tax Bill Introduced - UK Pensions
Wow UK annuity market gone....
http://www.thisismoney.co.uk/money/index.html
http://www.thisismoney.co.uk/money/index.html
Mar 20th 2014, 8:53 am
#137
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Joined: Jan 2011
Location: New Zealand
Posts: 455
Re: NZ Tax Bill Introduced - UK Pensions
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.
Because of these reasons i cannot see many reasons to transfer other than to reduce tax.
Most schemes in the uk allow 25% withdrawal as a lump sum. In NZ it is possible to withdraw 30% plus any investment growth that the funds have made since it arrived in NZ. This can be from the age of 55 (not 65 as you state). The rest is to be used as an income for life.
With the announcement in the UK budget yesterday, it is expected that any changes will flow through to NZ schemes as well. However NZ already has the facility to withdraw the full amount without penalties if carefully planned.
The NHS provides either a full pension or a reduced income plus a lump sum. If accepting a lump sum, it does have the effect of reducing the income benefits.
There are many benefits in completing a transfer but there are disadvantages too. Most have already been covered in previous posts.
Mar 20th 2014, 9:03 am
#138
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Joined: Oct 2013
Location: Auckland
Posts: 14
Re: NZ Tax Bill Introduced - UK Pensions
Thanks..
Yes the some of that about the NHS is correct however....
Under the 1985 rules: You will automatically receive a retirement lump sum which is normally three times your annual pension. You also have the option of receiving a larger retirement lump sum in exchange for a smaller annual pension. If you choose to do this you will receive £12 of additional lump sum for every £1 of pension.
Under 2008 rules: There is no automatic lump sum entitlement in the 2008 Section (unless you opted to transfer your 1995 Section benefits to the 2008 Section during the Choice exercise), but you do have the option of receiving a retirement lump sum by exchanging part of your pension. If you choose to do this you will receive £12 of retirement lump sum for every
£1 of pension.
Yes the some of that about the NHS is correct however....
Under the 1985 rules: You will automatically receive a retirement lump sum which is normally three times your annual pension. You also have the option of receiving a larger retirement lump sum in exchange for a smaller annual pension. If you choose to do this you will receive £12 of additional lump sum for every £1 of pension.
Under 2008 rules: There is no automatic lump sum entitlement in the 2008 Section (unless you opted to transfer your 1995 Section benefits to the 2008 Section during the Choice exercise), but you do have the option of receiving a retirement lump sum by exchanging part of your pension. If you choose to do this you will receive £12 of retirement lump sum for every
£1 of pension.
Mar 20th 2014, 9:12 am
#139
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Posts: 455
Re: NZ Tax Bill Introduced - UK Pensions
Thanks Plent2d, great information.
Mar 20th 2014, 9:14 am
#140
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Location: Blenheim, NZ
Posts: 1,504
Re: NZ Tax Bill Introduced - UK Pensions
Before this thread is closed, I would like to thank chc4me for his invaluable input & knowledge to this thread. Which in following the posts has given me a much better understanding of transfer of pensions. 
Mar 27th 2014, 3:07 am
#143
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Joined: Oct 2003
Posts: 38,613
Re: NZ Tax Bill Introduced - UK Pensions
