In April 2016, GBPensions reported on upcoming changes to New Zealand pension legislation, restricting withdrawal benefits of any UK pension funds that might be transferred under the QROPS (Qualifying Recognised Overseas Pension Scheme) regime. These proposals would have drastically affected the amounts that could be accessed and when.
The “top line” of these proposals meant that, instead of being able to withdraw approx. 30% of the transferred fund at age 55, members would only be able to take less than 10% at that age.
Our original news item “If you are considering transferring your pension from the UK to NZ, be aware: the goalposts are moving again!” covers the regulation changes in greater detail.
Fortunately there is some potentially good news, as revisions to the relevant section of the Financial Markets Conduct Act 2013 (FMCA) have just been announced.
These amendments may significantly reduce the possible impact of the proposed legislation, as trustees of NZ superannuation schemes which are also QROPS can now use the current rules or a variation of the original proposals, in calculating and making benefit payments.
This outcome has been welcomed by the pension transfers industry and potential scheme members alike.
If you’d like to read the original legislation, it can be found in Financial Markets Conduct Regulations, Schedule 12 “Superannuation Scheme Rules.”
The amendments can be found in Financial Markets Conduct Amendment Regulations, 25th October 2016.
Could this legislation affect you?
If you’ve ever worked in the UK, chances are that you will have accumulated a personal or company pension. Now that you’re settled in NZ, there are three options for you to consider: either leave your pension where it is, move it to a SIPP (Self-Invested Personal Pension) or transfer it to a NZ QROPS. At the time of writing and to the best of our knowledge, we believe that GBPensions are the only NZ pension transfer specialists offering the choice of a SIPP to their clients. You can read more about this in our blog: “Leave it where it is, move to a SIPP or transfer to a NZ QROPS? Which will you choose for your British pension?”
There have been regular legislative changes in both the UK and NZ since the so-called “Pensions ‘A’ Day” on 6th April 2006. It’s important therefore to weigh up your pension transfer options carefully so that you can determine the most appropriate course of action for you and your personal goals.