Requirements for the transfer of your pension funds

Contrary to the suggestions on many ‘transfer specialist’ websites, the only requirement for a transfer to take place is that the receiving scheme is a QROPS (Qualifying Registered Overseas Pension Scheme) of which you are a member. The requirements: to have left the UK permanently; to have acquired NZ residency; to be employed in NZ; to not be employed by a UK employer or the NZ branch of a UK employer; that no benefits have been taken - all ceased on 6 April 2006, There is even no longer a requirement that the receiving QROPS scheme is situated in the same country as the member.

Whilst this is the technical position, many pension fund trustees will still ask for confirmation of some or all of these former requirements, and most of the time it is not a problem to provide them.

Generally, a QROPS is a superannuation scheme that is supervised by a Government and is tax-recognised in the country in which it is based. UK pension trustees will refuse to transfer to anything but a QROPS, so it is almost impossible to incur tax charges on the transfer itself.

It is technically possible to transfer pension funds from schemes where benefits have started to be taken. These include drawdown schemes (aka alternatively secured pensions) and occupational schemes, although for an occupational pension in payment to be transferred it must be permitted by the scheme rules, and such schemes are rare.

It is also technically possible under UK tax rules to transfer part of a pension fund or to have a pension fund split between a number of schemes. Many UK pension schemes will refuse to do this however, citing administrative difficulties.