We are starting a project to compare QROPS pension transfer fees to New Zealand funds; we are seeking reader input to complete a comparison table

We are starting a project to compare QROPS pension transfer fees to New Zealand funds; we are seeking reader input to complete a comparison table
Understanding pension transfer fees before you commit to a Fund is important.

There are apparently for than 100,000 people in New Zealand who have a foreign pension scheme and who have or wish to transfer that here.

The main transfer is from the UK, but transfers from other jurisdictions such as Australia or South Africa are common as well.

However, the rules covering these transfers are complex, mainly because there are two legal authorities involved; the New Zealand authorities and the offshore one. Both have strict scheme and transfer rules, many of which are incompatible with each other.

This has been a breeding ground for frustration.

Usually the foreign authority makes rules that take into account none of the New Zealand circumstances.

The clearest example is when you try to transfer a UK pension to a New Zealand KiwiSaver scheme. In theory it is quite doable.

But many of the intricate and bureaucratic British rules don't go away after you have transferred. They constrain your new KiwiSaver account in ways that no New Zealander has to worry about.

For example, KiwiSaver gives you flexible access to your funds for things like a first-home deposit, in cases of hardship, when you move permanently overseas, or even when you turn 65.

But all these types of payments from a British pension that is converted via the QROPS scheme would be 'unauthorised' by the British authorities and would incur penalties which could be substantial.

The British require NZ KiwiSaver schemes to be authorised by them to allow the transfer in the first place. By such registration, the NZ scheme is required then to report all such withdrawals to those British authorities.

Complexities like this have allowed a thriving local industry to develop to advise foreign pension holders of their options, rights and responsibilities.

These advisers and the authorised schemes have fee structures for this relationship that is causing extensive unease, even anger.

We have started a brief survey of the fees involved and found a wide range, and in fact some strange and surprising charges.

Most pension holders don't have an easy way to assess fees before they choose a fund or adviser to work with and often get big surprises after they have signed up.

To help, we are starting a table comparing the fees from the New Zealand funds. H/T Colin J.

Our comparison table starts with the list of British-authorised New Zealand funds. We will add authorised funds by other governments based on reader suggestions.

Our table is not complete and we are asking readers - that is, the Funds industry, advisers, and pension tranferers themselves - to help with information that will extend the comparisons and make them as accurate as possible.

You can find our work-in-progress table here.

Either use the comment system below to advise updates (you need to Register first, or Login), or our Feedback page.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

1 Comments

Comment Filter

Highlight new comments in the last hr(s).

Hi I am one of those people who are at the start of trying to decide whether to bring over a works pension or not. Having read all the posts i am still quite undecided but learning more towards bringing it. One added complication is that as i have only been here 2 years I still have a further 2 years in which to bring over my pension tax free. Also as I am able to release 25% of my pension tax free would i better to bring that over as cash and start a new pension here, avoiding administration fees. bringing the remainder over in a lump sum when i can take a further 25% tax free only paying tax in the UK on the remainder. Providing its all completed within my 4 year tax holiday in NZ i will avoid paying tax.

It just greves me to keep paying admin fees to move my money.