The New Rules and Regulations for QROPS in NZ for 2014
What is a New Zealand QROPS?
British expats and New Zealanders who have worked abroad can transfer their UK pensions to a QROPS in NZ to get their pensions out of the UK for tax purposes as well as collating all their pensions into one centrally managed place in GBP.
Who is a New Zealand QROPS aimed at?
- Expats who want their pension actively managed for them in GBP
- Expats with a conservative or balanced risk profile
- Expats who don’t know which country they want to retire in
- Expats who want to retire in New Zealand
- Expats who want to retire in Australia
- New Zealanders who have worked in London or the UK and returning to live back in New Zealand
- Expats who want security and do not wish to manage their own money or take an income or drawdown. They just need a qrops for inheritance planning
Who is am NZ QROPS NOT suitable for?
- Expats living and retiring in the United States of America – click here
- Expats who want to manage their own investments – click here
- Expats who want a variety of investment strategies
- Expats who want to invest in several currencies
- Expats who want to invest in a currency other than GBP
Summary of Benefits of the Foreign Tax Exempt NZ QROPS Scheme
- Automatically managed by investment professionals on your behalf
- The NZ based discretionary fund managers actively manage your pension monies, so you don’t have to worry about it
- Choice of five investment strategies depending on your risk profile
- No tax on growth within the portfolio
- No tax on income when you decide to take your pension income and benefits
- 30% cash lump sum available at 55; the other 70% of funds must be used to provide a pension income for life
- No need to look into the complex Double Taxation Treaties in the country you reside in as it your QROPS benefits will be tax neutral, i.e. there will be no tax on it at source in NZ
QROPS Trustees in NZ
What is the address in New Zealand for the QROPS pension trustees?
We use Brooklands pensions in New Zealand. Brooklands are QROPS trustees and well known specialists in the industry with a strong English speaking administrative team.
PO Box 29-086
What are the fees and charges for the QROPS NZ Set Up?
The fees are 300 GBP set up fee and 300 GBP per year after that for the QROPS trustee service in New Zealand which covers the pensions compliance and actuarial work. There are other fees for the investment management depending on the strategy you use. Please email us for more info.
Latest Regulation Changes to QROPS in NZ
Changes to QROPS Elligibility in NZ
Unfunded public sector final salary schemes (such as teachers and NHS pension schemes) will not be allowed to transfer out to a QROPS from April 6th, 2015.
Funded public sector schemes, i.e. local council and local government schemes can still transfer to a QROPS.
DB schemes in the private sector can still be transferred even after 2015 as long as a UK FCA regulated adviser signs off on the transfer.
Types of QROPS in NZ
New Zealand superannuation schemes are assessed for tax on taxable investment income; coupons, interest, rents and deemed investment return from overseas shareholdings.
Schemes can be taxed under what is known as Portfolio Investment Entity provisions (PIE) or the widely held companies’ rate.
PIE funds are pooled vehicles such as Unit Trusts, OEIC’s and UCITS. However, there are some additional requirements to be a PIE fund, such as the number of members a PIE fund must have (minimum of 20 within 12 months of the first receipt as well as the maximum amount of interest any one investor can have in the investment pool (20%)., but in essence any fund meeting these requirements can be PIE.
Foreign Tax-Exempt NZ QROPS
PIE’s require you to pay taxes at the highest Prescribed Investor Rate (PIR). Luckily, we have sourced a NZ-based QROP scheme which is the Foreign Investment Zero Rate Portfolio Investment Entity (FIZRPIE) which means ZERO tax on growth and zero tax on income.
Fortunately, John Key, who is the current Prime Minister and an ex-currency trader who worked in the City of London, is working to diversify New Zealand’s economy away from soft commodities and is keen for financial services to be part of this diversification.
New Zealand is not a tax haven. It is not on any “black lists’ or “grey lists”, but it is a suitable jurisdiction for sensible tax planning.
PM Key wants NZ to become the financial centre for the Australasian area and they are putting in strong regulations to attract corporate and high net worth individuals. New Zealand is part of the OECD and it complies with both FATCA and GATCA regulations. However, it is an excellent location for secure tax-free offshore pensions.
The government of New Zealand has proactively taken steps to ensure that New Zealand has an effective and transparent tax system, and the New Zealand tax authorities are consistent in their application of the country’s tax legislations when assessing tax liabilities and enforcing document filing requirements.
Please contact us for a free pension transfer analysis for QROPS in New Zealand.