tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Wednesday, May 25th, 6:31PM

News

rss
Latest Headlines

Mixed fortunes in pension transfer market

Confusion in the pension transfer market is leading to a drop in demand, one provider says.

Monday, January 25th 2016, 6:00AM

by Susan Edmunds

Recent rule changes have made it harder to transfer British pensions to New Zealand.

British rule changes meant KiwiSaver schemes have lost their Qualifying Recognised Overseas Pension Scheme (QROPS) status.

A QROPS is a scheme that meets requirements set out by Britain’s HM Revenue and Customs and can accept transfers without the 55% penalty tax that would otherwise be applied.

UK non-funded state pensions, such as those held by people working in the health sector, also can now not be transferred internationally.

On New Zealand’s side, the way non-Australian foreign pensions are taxed has changed. 

In the first four years as a resident there is no tax payable. It then increases every year so that after 25 years, the full amount is taxable.  An amnesty in 2014 allowed some leeway for those who had not paid the right tax.

Alun Rees-Williams, of pension transfer and financial advice provider Britannia said there was a lot of confusion in the market.

He had been contacted by one person who thought transfers were not possible at all any more because KiwiSaver providers could not do it.

The loss of the right to move non-funded state pensions had also put a dent in the marketplace, he said. Rees-Williams estimated up to about a third of the market previously had been those pensions.

Some providers had expected to get busier when KiwiSaver schemes lost their QROPS status, he said, but the reverse seemed to have happened.

He predicted the activity would return but not to the surge levels before the end of the tax amnesty.

"It's got to build up again," he said. "There are still valid reasons to do it."

But Tony Chamberlain, of GB Pensions, said he had noticed an increase in inquiries since the beginning of the last quarter of last year.

He said that could be due to the firm beginning to be recognised as specialists in pension transfers, or because people who might otherwise look to their KiwiSaver providers for help were turning elsewhere.

“We were getting inquiries on our website even on Christmas Day.”

He said GB Pensions was working on a new product that would be more effective than QROPS for some people. He could not yet provide details.

Tags: pension transfers QROPS

« Draft new code revealedLVR restrictions to be reviewed »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 5.35 4.49 5.25 5.55
ANZ 5.54 5.15 5.85 6.15
ANZ Blueprint to Build 2.78 - - -
ANZ Special - 4.55 5.25 5.55
ASB Bank 5.35 4.49 5.25 5.55
Avanti Finance 5.45 - - -
Basecorp Finance 6.45 - - -
Bluestone 5.29 7.49 7.59 -
BNZ - Classic - 4.55 5.25 5.45
BNZ - Mortgage One 5.55 - - -
BNZ - Rapid Repay 5.55 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 5.55 5.35 5.94 5.99
BNZ - TotalMoney 5.55 - - -
CFML Loans 6.45 - - -
China Construction Bank 5.50 5.40 6.14 6.40
China Construction Bank Special - 4.45 5.19 5.45
Credit Union Auckland 5.95 - - -
First Credit Union Special 5.85 4.70 5.20 -
Heartland Bank - Online 4.00 3.85 4.70 4.84
Heretaunga Building Society 5.95 4.80 5.50 -
HSBC Premier 5.49 4.39 5.15 5.39
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.25 4.29 5.09 5.35
Kainga Ora 5.43 4.57 5.58 5.85
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 5.00 5.55 6.19 6.39
Kiwibank - Offset 5.00 - - -
Kiwibank Special 5.00 4.55 5.19 5.39
Liberty 4.84 - - -
Nelson Building Society 5.95 4.95 5.85 -
Pepper Essential 3.44 - - -
Resimac 4.59 5.60 6.16 6.29
Lender Flt 1yr 2yr 3yr
SBS Bank 5.29 4.69 5.35 5.49
SBS Bank Special - 4.19 4.85 4.99
Select Home Loans 4.09 4.29 4.86 5.09
The Co-operative Bank - First Home Special - 4.19 - -
The Co-operative Bank - Owner Occ 5.45 4.29 5.19 5.45
The Co-operative Bank - Standard 5.45 4.79 5.69 5.95
TSB Bank 5.59 5.14 ▼5.79 6.15
TSB Special 4.79 4.34 ▼4.99 5.35
Unity 5.65 4.80 5.50 -
Wairarapa Building Society 5.24 4.55 5.20 -
Westpac 5.54 5.09 5.79 6.09
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.54 - - -
Westpac Special - 4.49 5.19 5.49
Median 5.45 4.55 5.25 5.52

Last updated: 19 May 2022 10:42am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com