For individuals migrating to New Zealand it has always been important for them to look at their options for their UK pensions.
Since the introduction of Qualifying Recognised Overseas Pensions Schemes (QROPS) by the UK HMRC in April 2006, UK pension benefits can transfer to approved, offshore pensions throughout the world – including New Zealand.
Given the tax free nature of benefits paid from a New Zealand scheme, it would be a logical step, in most cases, to transfer UK pension funds to a QROPS in New Zealand. However, although benefits in New Zealand are tax free, the growth of the funds within the New Zealand QROPS would be taxed.
Up until recent changes in the New Zealand legislation, any income paid from a UK pension scheme to a New Zealand resident would be subject to the New Zealand foreign income tax rules. However, the changes in the legislation have meant that a New Zealand resident can receive income from a UK pension scheme (or another offshore QROPS) in certain circumstances and not be taxed.
This has opened up some key tax efficient options for New Zealand migrant’s UK pensions where previously the only way of receiving tax free benefits was to transfer UK pension funds to New Zealand QROPS. Global QROPS Ltd advisers can recommend the most beneficial option for anyone with UK pensions looking to migrate to New Zealand.
