New Zealand is a jurisdiction that has for a long time been at the forefront of QROPS. With a 0% tax rate on growth for foreign investors, many UK pension holders have chosen this destination as the preferred choice for a pension transfer.
There were previously a number of schemes in operation in New Zealand offering 100% access to the investor’s savings upon retirement, however this was soon noted by HMRC and was stopped. Since then however, the British Government has introduced the option for 100% withdrawal of pensions for UK pensioners, and this has now been extended to include QROPS. As a result, anybody wishing to be granted access to their funds in their entirety may be best suited to the tax-free withdrawal system which has been reinstated in New Zealand.
Many other jurisdictions will have to amend their own legislation in order to cater for this feature and some may choose not to offer this, but New Zealand already have the necessary systems, providers and schemes in place to be able grant 100% access if required.
Other benefits offered by taking up a QROPS in New Zealand include:
- No reliance on Tax Treaties. Once NZ is chosen, funds can remain tax-efficient regardless of where the saver moves to.
- No requirement for foreign investor to report their current residence and tax status to New Zealand.
- High level of compliance and excellent regulation.
- Access to pension at age 55 (at time of writing).
- No Inheritance Tax on remaining funds.
- Transparent system relating to fees and fund management costs.
To find out more about the possible benefits a New Zealand-based scheme can offer, please contact us today and an advisor will be in touch.