Moving overseas - what to do about pension?

dwaldron

I am an Australian who has been living and working in the UK for three years. I have recently changed employment and as a result there is £2,265 sitting in the company pension plan, which I am mindful to transfer to a stakeholder pension plan and then contribute to it. I want to be contributing to something as I am 37 years old and have very little tucked away.

What I need to work out is - is it worth it? I plan on returning to Australia in about 3 years time. I am considering contributing about £100 a month (after tax benefits) into the new pension, thus I would contribute a further £3,600 before returning home.

I have located some people that arrange for UK pensions to be transferred to an Australian superannuation plan (which I already have) at a cost of £300 + 5% of the fund.

Are there any funds that specialise in assisting people that move overseas?

I've probably explained the above very poorly, but let's see what happens!!!

ralord

I spent 10 years in the UK and found great difficulty transfering the funds to OZ I would suggest that pay the 100GBP directly into a fund in OZ not the UK it will be easier to Track and possibly more tax efficent you do not want to pay 5% it is too high

Cook_County

The answer was always to transfer all UK pensions to super to avoid the horrid Aussie FIF tax regime.

However the UK is changing the rules on 6 April 2006, and as yet there are no Australian super funds able to accept transfers under the UKs new conditions.

I would speak with the Australian Embassy as the double taxation agreement may need to be renegotiated to cover the problem but they may be working on this topic already...

Joannaclaire

Interesting that the transfer cost is quite high - 5% plus the £300... I'm an aussie working in the Uk but am considering opting out of the NI state pension S2P as we intend to go back to live in oz at soem stage, so was wondering how things worked with transferring funds from UK to Oz pensions/superannuation....

dwaldron

That is exactly what I am planning on doing too. I have accumulated 10% of my income as a pension over the last few years so the amounts are not insubstantial. I contact the people who do the transfers and they say that there is no change post A Day. I too have opted out as the probability of me working here for ten years (and thus becoming eligible for a full UK pension) is fairly remote.

Joannaclaire

Ah - see that's my dilema. I''ve been here paying ful whack of NI for the past 6 years - am now just on my 7th, so am of two minds whether to take the gamble and keep paying it for the next 3.75 years, in the hopes that I may one day get a UK pension in Oz, or whether to take the money and run, bearing in mind my aussie super fund has dwindles down as i'm not makign contributions there.. it's so difficult to know what the right thing to do is, isn't it? Specially as i'm now pregnant, so won't be (in theory) working full time again for the foreseeable future - although I'm self employed, so will maybe work a bit...