advertisement


Any pensions experts here? Transferring an NHS pension from the UK to NZ

Sean K

Sean K

pfm Member
Disclaimer: I'll be forking about for advice from a couple of professional pension advisors at some point.

I was an NHS employee from 1992 to 2005, when I emigrated to NZ. I paid into the NHS superannuation scheme during this time.

I won't be returning to the UK to work. I'm currently 53, still working and at least 10 years from retirement.

The NHS scheme was a 'final salary scheme' when I left it.

My obvious goal is, ensuring that over the next 10+ years, I make the most of the sum I have invested with the NHS scheme.

I am aware there are pension schemes in NZ (QROPS) to which the UK/NHS will approve transfers.

Many thanks
 
It's a long time ago since I looked into it, but if it's the same as Oz, there is a limited time window (6, maybe 12, months after entering the country?) during which you can transfer into QROPs schemes without large tax penalties.
You'd do best seeking professional advice, which it sounds like you will!
 
Can,t they just pay it to you in NZ each month ? What happens if you change your mind and return to uk
Also its index linked to uk inflation which gives a high increase each year sometimes , but not all
 
You can't transfer as the scheme isn't funded. No scheme would accept a DB pension in any event. Your choices are to take it or defer it. Contact NHS pension scheme administrators and ask what your options are. I'm pretty confident...

There is no "sum" in there, it is a pension proper, monthly amount
 
  • Like
Reactions: gez
I'm not clear what the question is, but given that final salary defined benefits schemes are the best pensions you can get, even if it were possible I'd not be transferring it anywhere. Leave it to mature and then have it paid in to a UK bank account, from which you can then withdraw funds as you like.

By the way, you may want to look in to making Class 2 National Insurance payments to the HMRC to top up your UK state pension (unless you've already contributed the 35 years required to gain a full one). As someone who's working abroad you can pay Class 2 NICs which will cost you in the order of £180 to add another qualifying year to your state pension. Each extra qualifying year, will gain you £302 (at todays pension value) extra pension from 67 until you die. Given that you get back more than you pay in even if you were to get the state pension for 1 year.. the maths makes sense IMHO.


www.gov.uk

Apply to pay voluntary National Insurance contributions when abroad (CF83)

Pay voluntary National Insurance for periods abroad.
www.gov.uk www.gov.uk

NB: I'm assuming you're a UK citizen
 
I used to work for BT, when they made me take my pension at 60 there was no option to take the pension pot elsewhere, just how much lump sum I wanted.

Get advice from an NHS trade union, they must have seen this lots of times. Perhaps ask other ex-pat groups of ex-NHS employees what they did.

If you could transfer then you would transfer some valuation of your pension pot which might be taxed. All you could then do is put it in the bank or buy an annuity. I doubt either would be better than leaving it where it is.

If you leave it alone the issue then becomes how to get paid, the pension scheme can advise.
 
John Thomas said:
You can't transfer as the scheme isn't funded. No scheme would accept a DB pension in any event. Your choices are to take it or defer it. Contact NHS pension scheme administrators and ask what your options are. I'm pretty confident...

There is no "sum" in there, it is a pension proper, monthly amount
Click to expand...
Really?
According to the NHS scheme you can.
You might like tell the BMA where they re wrong…

www.bma.org.uk

Transferring money out of the NHS pension scheme

This guidance is for members who leave the NHS pension scheme prior to retirement who may wish to transfer their pension benefits out of the NHS pension scheme and what actions you need to take to do this.
www.bma.org.uk www.bma.org.uk
 
Last edited:
epo1 said:
I used to work for BT, when they made me take my pension at 60 there was no option to take the pension pot elsewhere, just how much lump sum I wanted.

Get advice from an NHS trade union, they must have seen this lots of times. Perhaps ask other ex-pat groups of ex-NHS employees what they did.

If you could transfer then you would transfer some valuation of your pension pot which might be taxed. All you could then do is put it in the bank or buy an annuity. I doubt either would be better than leaving it where it is.

If you leave it alone the issue then becomes how to get paid, the pension scheme can advise.
Click to expand...
Also, is the NHS pension not index linked once it's being paid out? The BT one is, to a point at least (I know I'll be getting one at 60 too - bit peeved it can't be deferred to be honest). Annuities are not. So something else to consider.
 
Thanks so much for all the helpful advice and comments. I have a separate scheme, here in NZ, so I don't have all my eggs in one basket. The point about it being a final salary scheme, rather than a sum invested is obviously key. The bit I'm trying to get my head around is whether there are advantages to paying tax on it in the UK or at this end. As you can tell I'm far from expert on this and have been putting off investigating things for about 5 years. I've made the first step, emailing Fleetwood (if that's where they're still based) for a statement and with some questions.

Thanks again
 
Welcome to NZ Sean. I hope you find a way through the bureaucracy (I always need spellcheck for that word).
 
UK pension law has changed massively over the past 10-15 years or so (probably longer). About the only thing you can't do now, is remove all of your money tax-free, which you never have been able to, otherwise, anyone is free to do what they like with it, even if the "system" now asks you a million times if you are sure you want to do what you propose.
I am about to retire and to make life easier, I have transferred two small pension pots into a third. Both providers that I left had me jump through endless hoops even though one was just £7K and the other £15K, and it was being transferred to Aviva.

The rule over income tax was that if you were abroad for more than a few months (6????) each year, you could opt to pay tax in whichever contry you chose - this was how the trades people working abroad made a mint in the 1970's/80's as per Aufwiedersehen Pet.

There is an age limit to most changes/options you can take with pensions - generally, you have to do whatever you want to do before age 75.

I didn't like to ask for details, but the village idiot at work had his mother, who works in the NHS, transfer all her pension out of the NHS scheme. Yes, he really is that thick, and she is obviously not much brighter. Like an awful lot of people, he/they see a pension pot as just a massive pot of gold, not something that is meant to feed and house you for, hopefully, 20+ years after finishing work.

How stable long-term, is the £/NZ$ exchange rate? That should influence what you do, in fact, it should have been considered 20 years ago. A friend of a friend had a pension in RSA and SA law prohibited moving the money to the UK and within a few years her ZAR pension was almost worthless.
 
Vinny said:
How stable long-term, is the £/NZ$ exchange rate? That should influence what you do
Click to expand...
Very tricky to predict the future, but most of my life we viewed it as 3 NZD to 1 GBP (rounded). Now it is 2 to 1. Which counties politics/economy is going to stuff up the most going forward ?.... jury is out I suspect, but that is not my field.
 
artoly said:
most of my life we viewed it as 3 NZD to 1 GBP (rounded). Now it is 2 to 1.
Click to expand...

Hindsight is always a most wonderful thing, but transferred at the higher rate would have meant a pension worth 50% more now in NZ$ terms. I can't see return on investments being wildly different UK v NZ - if they were, one would see all their money/savings/investments go to the other.
 
gez said:
By the way, you may want to look in to making Class 2 National Insurance payments to the HMRC to top up your UK state pension
Click to expand...
You can also voluntarily pay for a limited number of "missing years" and as per Gez's illustration, that can add up significantly.
 
  • Like
Reactions: gez
Until 2025 you can buy missing years NI back to 2006.
After that it will revert to limiting you going back no more than 6 years.
 
Last edited:
Sean K said:
Thanks mate!. I've actually been here nearly 20 yours, it's just taken me taht long to get round to retirement planning!
Click to expand...
Sean, as a family lawyer with a specialism in pensions I would recommend you go to a pension actuary. They are not cheap but what they don't know isn't worth knowing...I would mention George Mathieson of Mathieson Consulting, Southdown consultancy or Anne Pettifor of Collins Actuaries. Most of your regular IFAs wont have a clue though there are exceptions.
 
Sean, you need advice on tax, is there a local lawyer or pension adviser who could help? If you decide to leave it with the NHS, find out if there is a NZ (or AUS?) bank with a branch in the UK. If so you could get your pension paid in there and transfer for least bureaucracy.

My partner is checking their state pension eligibility currently and needs 35 years full contributions to qualify for a full pension. Interestingly, the HMRC pension site reckons there is about 5 more years contributions than could possibly have been paid, this covers student years.

My gut feel is that the NHS (and teacher's) pensions are one of the best parts of the job, walk away from it only if you are convinced your other option is better.
 
You must log in or register to reply here.


advertisement


Back
Top