QROPS Australia: UK Pension Transfer to Australia for the Over 55s

UK Pension Transfer to Australia for the Over 55’s

QROPS Australia: UK Pension Transfer to Australia for the Over 55s

14:29 12 January in Blog

If you are thinking of retiring to Australia or if you have already retired down under, you may be considering what you want to or what you can do with your UK pension scheme. A UK pension scheme is likely to still be taxed if paid to you whilst you are resident in Australia, whereas most Australian Superannuation can be withdrawn tax-free from your Australian retirement age.

QROPS Australia Rules 2016/17

The recent changes to the QROPS rules mean that if you are over 55 and have a UK pension to transfer to Australia, in many cases you can, as long as it is to an Australian SMSF which is QROPS / ROPS compliant and you obtain appropriate advice (this must be from a UK adviser where you have defined benefit or safeguarded benefits worth over £30,000).. Let’s have a look at what else has changed under the latest QROPS Rules for 2016/17:

  • New lifetime limit for an Australian Superannuation scheme is $1.6m Australian dollars from 1st July 2017, with any excess being able to be placed in a taxable accumulation account.
  • The HMRC has not relaxed its restriction for a transfer into a QROPS in Australia SMSF if you are under 55 years old.
  • If you are under 55, other options exist for transfers of your UK pension funds.
  • From 1 July 2017, the annual Non-Concessional Contributions (NCC) cap will be $100,000 per year.
  • Individuals under age 65 will be eligible to bring forward 3 years ($300,000) of NCCs.
  • The work test will continue to apply for individuals aged between 65 and 74, i.e. if you are 67 years old and living in Australia, you need to be working 40 hours per month in employment within the relevant Australian financial year to move your UK pension to an Australian QROPS.

If you are moving and are looking for advice on your UK pension transfer to Australia, our specialist team can advise you on your options and provide a formal recommendation on your optimal course of action. Get in touch to discuss your UK pension transfer to Australia.