Important information for anyone that has or intends to transfer their UK Pension to an Australia Superannuation (QROPS) Fund.
Proposed changes by HMRC to UK Pension Transfers are now to come into effect from the new UK tax year 6 April 2012.
The changes can be read here http://www.hmrc.gov.uk/pensionscheme...s-template.pdf
It is very important if you have transferred to understand how these changes will impact on you.
The rules were:
that the receiving Australian (QROPS) scheme report member withdrawals for a term of 5 full tax years since ceasing to become a UK tax resident.
The rules now state:
that the receiving Australian (QROPS) scheme must report member withdrawals for 10 years from when the transferred Pension arrives.
This means that if you make a withdrawal from your transferred UK Pension within this time period and it is outside of the prescribed UK limits a tax charge of up to 55% can be levied by HMRC!!
This rule change suggests it will be retrospective, therefore anyone that has QROPS monies in Australia will have to adhere to the new timelines.
Therefore it is vital that if you intend to start drawing on your Australian Super (formerly UK monies) you are either outside of the reporting period or you seek advice on what you are able to draw.