Australia is the top emigration destination for Brits – with about 40,000 people a year leaving to take up a new life in the sun.
Many of these will have UK pension rights and may have pension funds languishing back in Britain.
If you are considering moving to the other side of the world, then think about what to do about your pension as well.
The problem is that once you have migrated to Australia, if you have a large UK pension fund, it may exceed the annual pension capped limit to Australia.
Most people looking to move to Australia should take professional, independent QROPS advice before they leave the UK to see if they need to find a home for their pension offshore to both countries.
Transferring a pension to Australia has several different solutions that are often dependent on the amount of money available to transfer from UK pension funds.
Often the best bet is to transfer the UK pension funds in to a QROPS based in the Channel Islands or Isle of Man.
Sometimes a staggered transfer over a number of pension years is a good way of avoiding the cap problem.
Lots of other confusion exists about transfers to Australian pension providers – one of the main myths is the transfer has to be completed within six months of permanent arrival in the country otherwise the fund will be taxed at 50%, which is not true.
The fact is the Australian tax authorities could charge tax against any growth in the fund in that period, but the tax rate is certainly nowhere near 50% and often leaving the fund in UK Sterling is advantageous to switching to another currency at the wrong time.
If you are considering emigrating to Australia and want to know how to manage your UK pension, you need an n experienced and qualified advisor to give the best advice.
That’s why checking out your options with a regulated UK advisor is imperative to make sure you take the right steps at the right time to protect your pension investments.
