Do you have clients who have migrated from the UK?

UK photo

It may be wise to check if they have transferred their UK pension schemes over to the Australian superannuation system. From April 6, 2015 members of public sector pension schemes, including those covering the former National Health Service, will no longer be able to transfer the money to an Australian super fund.

If you live in Australia, you pay Australian tax on your UK pension. However if you transfer the fund out of the UK super system into Australia, the income in retirement is tax free. It is quite complicated with transfer amounts subject to Australian concessional contribution limits and potentially contributions tax applying to any capital growth, but for most, analysis suggests switching into the Australian system provides many retirees with a better outcome over the long term.

Hear Simon Harvey from Global QROPs talk about the issue in this 4 min video, including how going forward transfers of private sector-defined benefit pensions will require advice from a UK-regulated company, or read the article here.