Understand the recent changes

New tax option for pension transfers

With legislation now passed, a new tax option is coming for anyone looking to transfer an overseas pension to New Zealand. From 1 April 2026, individuals will be able to use the Transfer Scheme Withholding Tax (TSWT) - a flat 28% tax on eligible transfers paid by the receiving KiwiSaver or super fund.

What do I need to do now? 

If you elect to use the "scheme pays" option when you transfer your QROPs then AMP as your QROPs provider will pay the TSWT from the balance of your transfer before your funds are invested. As part of this process, we require you to provide the Assessable Withdrawal Amount (AWA) to us within 10 calendar days of AMP receiving the funds from your overseas pension. 

Exempt - what this means and eligibility requirements?

A 4-year tax exemption can apply to lump sums. You will not have to pay tax in the exemption period for the lump sum you receive.
The exemption period:

• starts from the date you become a New Zealand tax resident and runs for 4 years.
• is not available for foreign super acquired while you were a New Zealand tax resident.
   

If you become a non-resident within 4 years of becoming a tax resident, the exemption only applies from the date you became a resident until when you became a non-resident again.
If you are unsure whether you are considered exempt, please contact Inland Revenue or speak to a tax specialist. 

What is the Assessable Withdrawal Amount (AWA)?

This figure represents the portion of the transferred funds that is subject to tax. The final taxable NZD amount is identified by using either the formula or schedule method on the total funds received by AMP from your QROPS provider.
For resources on how to calculate your AWA please click here.

How much time do I have, what happens if I don’t do it in time? 

If you have selected the “scheme pays” option, you have ten calendar days to let us know the AWA once AMP has received the funds transferred from your UK Scheme Provider. You must provide the AWA within ten days. If this deadline is missed, you will automatically be opted out of scheme pays and will be required to pay the full tax directly to Inland Revenue.
Specialist financial and tax advisers will be able to guide you through the correct process and option for you. 

Things to consider when you’re thinking about transferring your funds

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. For example:

• Depending on the UK scheme you are in, you could be giving up features that are built into your UK pension such as spouse or dependent pensions, inflation-linked increases or benefits like insurance cover.
• It’s important to consider the exchange rate as you could be transferring your funds to NZ at a time when the exchange rate is less favourable to you than at another time.
• Once you have transferred your pension to New Zealand, you normally cannot transfer your pension back to the same UK scheme with the same benefits.
• There are tax implications when transferring your UK pension to New Zealand. Specialist financial and tax advisers will be able to guide you through any considerations you need to take into account.
• You may receive less money in the long run depending on the type of UK pension scheme you are in. For example, the amount of money you will receive if you transfer from a ‘defined benefit scheme’ (which forms the lump sum you bring to New Zealand), may not be sufficient to produce the same return over your lifetime compared to those you would receive if you stayed in the UK defined benefit scheme.
• If you have other accounts in the New Zealand Retirement Trust Scheme (NZRT) and you transfer your UK pension funds to NZRT, these other accounts will become subject to the QROPS rules. This means that even if the rules of your other NZRT accounts allow you to make a withdrawal, you will not be able to do so until you are entitled to make a withdrawal from your QROPS account. This is because when you are a QROPS member, the QROPS rules deem any withdrawal that you make from the NZRT to have been made from your QROPS account. Talk to your adviser for more information.