Understand the Benefits of Transferring UK Pension to Australian Super Fund
Perhaps you have worked overseas and want to retire permanently in Australia. Consolidating the benefits of your retirement savings accumulated overseas into your Australian super fund is possible, but you need to understand eligibility requirements and rules in order to for this kind of transfer to push through. The first step to transfer UK pension to Australian Super Fund is contacting your overseas fund in order to inquire and determine the eligibility of the transfer. This action could be subject to exit fees and tax implications, which is why it is important to communicate with your provider and seek international tax advice from experts before you decide to pursue the transfer.
To transfer UK pension to Australian Super Fund, the fund must also be a foreign super fund, otherwise it may not meet the requirements for consolidation with their Australian super fund. According to the Australian Taxation Office, a foreign superfund is a fund that provides benefits exclusively to members in relation to their invalidity, retirement, or death. The funds terms must likewise be consistent with the Australian super laws. Other schemes allowing withdrawals for purposes like education or housing are not considered super funds, although clients may apply for private binding ruling in case they are unsure whether or not their overseas fund meets the ATO definition of a foreign superfund.
Non-superfunds may be subject to taxation, according to their classification. For instance, some private rulings may define your overseas scheme as a foreign trust, for which payment will be treated as a trust distribution. Any income that you accrue or have accrued since your Australian residence will be taxed at a marginal rate. Other special rules may apply to your retirement funds, depending on the transfer scheme that you choose, which is why it is crucial to meet with a financial advisor before pursuing any type of transfer to get the full benefits of your pension.