by Susan Edmunds
Australia’s draft legislation allowing people to move their superannuation balances into New Zealand funds is a good move for anyone wanting to transfer savings across the Tasman, says Terry Baucher of the Tax Working Group.
The idea had already been agreed by both countries in principle but this move by the Australian Government puts the legislation in place to allow it to happen next year.
New Zealand’s Government passed legislation two years ago allowing New Zealand superannuation savings to be moved to Australia.
The new laws being drafted would allow Australian savings to be moved to New Zealand.
At the moment, Australians and New Zealanders working in Australia cannot take their retirement savings with them when they leave.
New Zealand moving to Australia will be able to consolidate their Kiwisaver savings into Australian accounts and Australians moving to New Zealand, or Kiwis returning home, will be able to consolidate their Australian accounts into New Zealand funds.
Baucher said if people wanted to avoid paying tax, the money would have to be transferred to a Kiwisaver account.
New Zealanders transferring money between Australian schemes would continue to be exempt from tax.
Baucher said: “If a person wants to withdraw or transfer to a non-Kiwisaver fund, that will probably be taxable.”
The ASFA said the move would build links between the financial and superannuation systems of the two countries.
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