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The most common questions...
and answers

Before you start, during and even after a pension transfer there are usually a mind boggling number of questions.  The questions below are the most common ones we are asked (just click on them to get the answers):

More questions

We aim to have a comprehensive guide on line, so please send through your questions

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Under what circumstances can I not transfer a pension?

This answer can depend on the individual requirements of your pension provider in the United Kingdom.  However, you cannot transfer a pension to New Zealand if part of your pension has come into payment in the United Kingdom.

In some circumstances there may be a requirement by the UK provider that:

  • You live and work in New Zealand

  • You are a tax resident of New Zealand

  • The transfer occur between two occupational schemes

  

 

 

How long will the transfer take?

The answer to this question is dependent on two factors: Your pension fund provider in the UK, and; how quickly the documentation can be gathered in New Zealand.  Often the providers in the UK are unfamiliar with transferring funds to NZ and must be walked through the process, this has become increasingly so for smaller providers since the change in transfer regulations in 2006.

The average transfers that we have been involved with take around 3 to 6 months, but as we say it may take longer or shorter depending on your provider in the UK.

Some of the documentation that you must collect will also be time consuming to gather.  You should be prepared for all types of requests; such as certified marriage certificates if you have changed your name after taking out the pension plan.

If you are in the United Kingdom and concerned about the responsiveness of your pension provider in replying to your requests please contact an Independent Financial Advisor (IFA) for advice.  If you do not already have an IFA in the UK we would be happy to recommend one to you.

  

 

 

How do I track down lost UK pensions?

If you have lost track of a former employer’s fund details, you can ask the Pensions Service to trace it. A request can be made online:

http://www.thepensionservice.gov.uk/atoz/atozdetailed/pensiontracing.asp

Or alternatively if you believe that your pension may be only one of many assets that you have lost track of you can use the following service:

http://www.uar.co.uk/

You can also contact your IFA in the United Kingdom with the details of who you were working for and the name of the pension provider.  They will be able to send a request to the provider on your behalf to get the details of the pension.

  

 

 

What are the risks involved in transferring my pension?

The main risks involved with transferring your pension are:

  • A 55% tax on the fund value if you do not transfer into a Qualifying Registered Overseas Pension Scheme (QROPS)

  • Transferring into the wrong kind of fund in New Zealand (see below under "What should I look for in a New Zealand fund?")

  • The exchange rate moves during the transfer process - this can either go for or against you.  However, as it is hard to determine the amount of time the transfer will take it is difficult to hedge against

Common misconceptions around risk are:

  • The transfer provider controls my money (this is not true - at all stages the funds are held under your name either directly or by the fund Trustee - no one ever has access to your funds except you)

  • The UK provider will not allow the transfer.  As long as you meet all the requirements they are required under law to transfer your pension

  

 

 

What should I look for in a fund in New Zealand?

Choosing a provider in New Zealand is critical as the wrong decision can end up costing you dearly in the long run.  We recommend looking for the following:

  • A fund that does not lock you in until retirement age - Some schemes in New Zealand will lock you in until retirement age giving you little control over your funds if things go wrong

  • A fund with low yearly management fees - High yearly management charges on the New Zealand fund can destroy up to 20% of the value of your fund by retirement

  • No exit penalty charges - Why should you pay to leave a fund that is not performing?  We believe that you should have the freedom to direct your money as you please.

To find out more about these and the great fee fallacy click here

  

 

 

Can I leave my pension in the UK for a while before transferring it to New Zealand?

Yes you can.  There is no legal requirement to transfer your pension to New Zealand.  However, leaving your pension in the UK could create a tax liability for you depending on your individual circumstances.

Foreign investment fund rules (which pensions sometimes fall under) may mean that you end up having to tax pay tax on the growth in your UK pension fund, even though you are not in the UK. 

This is a complex area and we suggest that you seek specialist tax advice from your accountant as to your individual circumstances.

  

 

 

Who controls my pension during the transfer process?

At all times your funds are kept in your name either directly by the superannuation fund provider in New Zealand, the pension provider in the United Kingdom, or by the Trustees of each of these respectively.  At no time are the funds not in your name.

At Charter Square we only control the process not the funds.

  
   
   

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