Our specialist QROPS Advisers can help take the stress out of transferring your UK pension.
Choosing a NZ Qualifying Recognised Overseas Pension Scheme (QROPS) to manage your UK pension funds can help you to consolidate your retirement savings in one place. We offer a QROPS through the superannuation section of the New Zealand Retirement Trust (NZRT) that has a simple fee structure, experienced administration team and offers peace of mind that comes with our respected brand.
For QROPS accounts we don't charge member, withdrawal, or contribution fees - only an Administration fee of 0.80% per annum, an Investment Management fee of between 0.20% to 1.31% per annum, and costs and expenses incurred, both by us and the fund managers we use, as part of running the NZRT.*
You can transfer your UK pension if:
• You are not already receiving income from an annuity purchased with your UK pension funds; and
• Your pension is not a State Pension, unfunded public sector pension or civil service pension; and
• The scheme you are transferring to is a QROPS, such as the NZRT
Unless you are already a member of the NZRT, you must be in NZ when you apply to transfer your UK pension to NZ.
This will depend on your current scheme, where it is based and whether all the required information is provided. We expect transfers from the UK to take three to six months and transfers from within NZ to take up to two months. The funds will be allocated to your QROPS account when they are received by the NZRT as cleared funds from your pension provider.
When your UK pension funds are received by the NZRT, you and your Adviser will receive a confirmation letter with the date that the funds were received and the New Zealand dollar amount.
From 9 March 2017, some transfers to and from a QROPS may incur a 25% UK tax charge called the Overseas Transfer Charge. This charge will apply if you are not a New Zealand tax resident when you request to transfer your UK pension funds from a UK pension scheme, or from another QROPS if the transfer is made within five full UK tax years of the date you originally transferred your UK pension funds from the UK ('five year period'), and the original transfer was requested on or after 9 March 2017. The charge may also become payable if you cease to be a New Zealand tax resident within the five year period, provided you requested the original transfer on or after 9 March 2017 and the transfer has not previously been subject to the charge.
New Zealand tax is not generally payable if your UK pension funds are transferred to New Zealand within the first four years of you becoming a New Zealand tax resident. However, if transferred after four years of you becoming a New Zealand tax resident, then the transfer may be subject to New Zealand tax. The amount of New Zealand tax payable is dependent on the calculation method used. You can find more information on calculating your New Zealand tax payable on withdrawals from a foreign superannuation scheme by visiting the IRD website. We recommend that you obtain advice from a tax specialist.
Once the transfer is complete, New Zealand tax is payable on the income from your investment under the Portfolio Investment Entity (PIE) tax rules.
In some circumstances, UK tax may also be payable when your UK pension funds are withdrawn from a NZ QROPS. We recommend that you obtain advice from a UK tax specialist before making a withdrawal.
You can begin withdrawing funds from your QROPS account once you reach the normal minimum pension age in the UK (currently 55). You can receive the funds in your QROPS account as a one-off payment, as a regular income or as a combination of both.
There may also be circumstances in which you can withdraw your funds before you reach the normal minimum pension age in the UK in the following circumstances:
• If you retire before age 55 due to ill-health, you will be able to withdraw the balance of your QROPS account. To do so you will need to provide evidence from a registered medical practitioner that you are, and will continue to be, incapable of carrying on your occupation because of physical or medical impairment.
• If you retire before age 55 due to serious ill-health and provide evidence from a registered medical practitioner that you are expected to live for less than one year, you will be able to withdraw all of your QROPS account.
• In the case of your death the balance of your QROPS account will be paid to your legal personal representative.
• If we receive a property sharing court order.
• If you transfer your funds to another QROPS.
No. KiwiSaver schemes do not meet QROPS requirements and therefore cannot maintain QROPS status.
* Your Adviser may charge a one-off Adviser fee on the initial transferred amount and/or an ongoing service fee. These fees are negotiated between you and your Adviser, so please contact your Adviser for any queries you may have about these fees. The Investment Management fee and any additional costs and expenses will depend on your investment fund choice. All fees may be subject to change. For more information regarding fees please see the 'NZRT Fees and other charges’ document on the AMP website at amp.co.nz/nzrt or talk to your Adviser.
Transferring UK pension funds to a QROPS provider could be one of the biggest and most significant financial decisions that you will make and it's important you seek expert financial and tax advice.
There can be disadvantages to transferring your UK pension to New Zealand so it’s important to consider the potential risks. Your Adviser will be able to help you understand how certain risks may apply so it’s important to seek advice.
* Your Adviser may charge a one-off Adviser fee on the initial transferred amount and/or an ongoing service fee. These fees are negotiated between you and your Adviser, so please contact your Adviser for any queries you may have about these fees.
AMP Wealth Management New Zealand Limited is the issuer and manager of NZRT. The Supervisor is The New Zealand Guardian Trust Company Limited (the 'Supervisor').
For more information about QROPS, QROPS transfers and NZRT, download a copy of the New Zealand Retirement Trust (NZRT) Personal Superannuation Section Product Disclosure Statement and Fund Update Booklet on our website.
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While care has been taken to supply information on this website that is accurate, no entity or person gives any warranty of reliability or accuracy, or accepts any responsibility arising in any way including from any error or omission. The content provided is intended to be used as information only and does not constitute financial advice, unless otherwise specified. Before acting on any of the results provided, we recommend that you seek advice which takes your individual circumstances into account.