The Process of transferring your UK Pension

The process is initiated by you completing a letter of authority enabling your adviser to get information from your pension provider of current benefits and a transfer value. This is not binding in any way and will only allow the adviser to receive details of the pension scheme you have.

Step one

Meet with a adviser to determine whether transferring your UK pension is appropriate to your circumstances. If you choose to transfer, you will be required to fill out initial paperwork.

Step two

If you are unsure of your pension details, an adviser will begin the process by locating your UK pension.

Step three

An adviser will check with your UK pension scheme to see if you have the right to transfer. Most UK company and personal pension plans can be transferred to Australia. If you left the scheme before 1 January 1986, you may not have a right to transfer.

Step four

At this stage, an adviser will determine whether you need to pay tax on your UK transfer.
In most instances, you are not required to pay any tax on your UK pension transfer.

Please note, if you are transferring after six months of Australian residency for tax purposes, you must pay tax on what is referred to as the ?growth component? of your transfer. This is the growth in value of your benefit between the time you became an Australian resident and the time the transfer occurs. You have two options for paying this tax:

1. Include the growth component in your tax return for the relevant year of income, and taxed at your marginal tax rate.
2. Have this growth component treated as a taxable contribution to your super fund, which means it will be taxed at 15% rather than at your marginal tax rate.

Step five

Your adviser will present the required HMRC forms for you to fill out as well as the relevant Australian superannuation application forms. Once these have been completed the transfer of funds can take place.

Frequently asked questions:

1. Am I qualified to transfer my UK pension to Australia?
   Moneytree Partners will be able to provide an assessment of your situation, and the applicable transfer options available to you.
2. What are the major benefits of transferring?
   The potential for tax savings, control over your investments and preservation of your estate for your dependents are the main advantages of transferring to an Australian QROPS fund.
3. What are some of the risks?
   Investment risk may be increased depending on which type of investments you select once the funds have been transferred out of your UK pension. This can be managed with your Moneytree Partners adviser.
4. How does one begin the process?
   Book an introductory appointment with a Moneytree Partners adviser. There is no obligation or charge for a first meeting.
5. Do state pensions qualify for transfer?
   Not basic state pensions, but you may be eligible to receive a UK state pension while resident in Australia.
6. Will I pay tax on the transfer?
   If the transfer is within six months of residency, then generally no. If you transfer after six months, you may have to pay tax on the growth component of your pension.
7. What is a QROPS?
   A Qualifying Recognised Overseas Pension Scheme is one which has been approved by HMRC as authorised to transfer into. This means that in most cases there is no UK tax charge (of up to 55%) applicable on the transfer.
8. How do I find a QROPS fund?
   An adviser can provide you with suitable options to transfer.