The below information is from the Scheme's ‘Other Material Information’ document dated 17 August 2023. The information was correct at that date. The information is intended as general guidance only. Payment of funds to you or a non-QROPS as a result of the Scheme wind up is a withdrawal. We recommend that you seek professional financial and tax advice (both UK and New Zealand) regarding your individual circumstances prior to receiving payment from the withdrawal or transferring your UK pension to another scheme. Neither we, nor the Supervisor, nor any other person involved in providing the Scheme to you takes any responsibility for any UK tax charges that arise as a result of making withdrawals or transfers of previous UK Transfers.
When can UK transfers be withdrawn?
UK Transfers can only be withdrawn in accordance with the QROPS Rules, under which a withdrawal can currently be made when:
you reach the UK minimum pension age (currently 55); or
you qualify for an ill health or serious ill health withdrawal under UK law, or you die.
The requirements for ill health and serious ill health withdrawals are currently as follows:
Ill health: If you retire before the UK minimum pension age because of ill-health and provide us and the Supervisor with evidence from a registered medical practitioner that you are, and will continue to be, incapable of carrying on your occupation because of physical or medical impairment, then you may make a withdrawal in the same way as if you had reached the minimum pension age.
Serious ill health: If you retire before the UK minimum pension age because of serious ill health and provide us and the Supervisor with evidence from a registered medical practitioner that you are expected to live for less than one year, then you may withdraw the full value of UK.
I made a UK transfer - what charges might I incur?
You may be required to pay a UK overseas transfer charge equal to 25% of the UK pension amount transferred (excluding returns) if you requested a transfer from a UK pension scheme to the Scheme (or another QROPS) on or after 9 March 2017, and within five full UK tax years following the transfer, you:
ceased to be a New Zealand tax resident; or
transferred your UK Transfer funds to a scheme in a country where you are not tax resident (including if you subsequently make a transfer to the Scheme or another New Zealand QROPS and you are not New Zealand tax resident at the time of that transfer).
We must notify HM Revenue & Customs of details of all current members of the Scheme who have transferred UK pensions to the Scheme. If directed by HM Revenue & Customs we may need to withdraw funds to pay the UK overseas transfer charge from your Personal Member account and pay this to HM Revenue & Customs on your behalf.
The UK tax year runs from 6 April to the next 5 April. If you subsequently become New Zealand tax resident within the five year period, it may be possible for the charge to be reimbursed.
I made a UK transfer on or after 6 April 2012 - are there any special conditions?
Any UK Transfer transferred into the Scheme on or after 6 April 2012 was accepted subject to the following terms and conditions:
the benefits payable to the relevant member, to the extent that they consist of the member’s relevant transfer fund or ring-fenced transfer funds (as those terms are used in the UK Finance Act 2004 (‘Finance Act’)):
are payable no earlier than they would be if pension rule 1 in section 165 of the Finance Act applied;
if payable earlier than that time, are only payable in circumstances in which they would be authorised member payments (as that term is used in the Finance Act) if they were made by a UK registered pension scheme;
any other terms and conditions required for a transfer to a QROPS under applicable laws and UK tax authority requirements; and
any other terms and conditions we agreed with the scheme manager of the UK or other scheme from which the UK Transfer was transferred and/or such other terms and conditions (including the purchasing of an annuity) as we determined as being necessary or desirable or in the interests of the relevant Personal Member or the Scheme, having regard to applicable laws and UK tax authority requirements (including limits or restrictions that have the purpose of ensuring that the Scheme complies with the requirements for a QROPS).
If you have made a UK Transfer (directly or via a current or former QROPS) to the Scheme, any withdrawals from the Scheme are subject to the QROPS Rules until the UK Transfer amount has been exhausted. This means affected members cannot make a withdrawal from the Scheme, including the employer section, until they are entitled to make a withdrawal under the QROPS Rules.
What are the potential UK tax charges on withdrawals or transfers to other schemes?
You may be subject to UK tax charges if you withdraw or transfer a UK Transfer (regardless of whether it was transferred directly to the Scheme or via another current or former QROPS) if it was transferred from a UK pension scheme and you have been a UK tax resident at any time within the current or preceding 10 UK tax years, or 5 years for persons who transferred their UK pension money outside the UK before 6 April 2017.
An unauthorised payments charge of 40%, and an unauthorised payments surcharge of 15% of the amount withdrawn or transferred, may be imposed. The UK tax year runs from 6 April to 5 April. The imposition of these tax charges depends on the application of the complex rules applying to UK pension plans.
Reporting to UK authorities
When a Scheme holds QROPS status, the manager must report withdrawals and transfers to UK tax authorities and also change in Scheme status relating to QROPS and wind up. Where you have made a UK Transfer, we must report withdrawals or transfers of those funds to UK tax authorities.
These reports have to be made until you are no longer subject to the UK tax charges and there has been a period of at least ten years from the date of the original transfer from a UK registered pension scheme. When you made a UK Transfer, you accepted that we will report such withdrawals or transfers to UK tax authorities and agreed to provide us with any further information we require to make these reports.
