Between Tax and NI, paying into a UK pension can be a drain on your take home pay.
Your employer is legally required to automatically enrol you in a pension, however you can opt out. To do this, you need to complete the opt out form provided by your employer and return it to them. If you do this within a month of being enrolled you will be treated as if you never enrolled and your contributions will be refunded to you. If you opt out after a month of being enrolled, you may not have your contributions refunded to you, these will likely be held until retirement, or if you choose to transfer these to a qualifying scheme at home in New Zealand.
Transferring your pension is currently possible, this is called QROPS, it is separate to Kiwisaver, and there are differences, you cannot withdraw early or use it for your First Home, however, you can access it from age 60 (Kiwisaver is age 65). If you want to transfer your pension home, you’ll need to search for a QROPS scheme, this is a relatively new process, and your best bet is to google search QROPS NZ for a provider who will manage this for you.
Whether you should contribute to a pension or not is not any easy question as everyone is unique. Given the often generous employer contributions and the ability to transfer this home, it is essentially free money. However, you may find you have a better use for the contributions.
Can I withdraw my Kiwisaver is a frequently asked question in the KIL group. The simple answer is yes, if you have been out of the country for more than a year and can provide proof in the form of:
– a statutory declaration stating you have permanently emigrated from New Zealand, and
evidence that you have:
– departed from New Zealand (for example, your passport records), and
– lived at an overseas address at some time during the year after your departure from New Zealand.
To get this underway you need to contact your Kiwisaver provider, if you are unsure who this is, get in touch with the IRD who can point you in the right direction.
A couple of important points,
If you close your Kiwisaver account you will get the full balance less any member tax credits, these will be refunded to the government and you will not get these back if you return to NZ and rejoin Kiwisaver.
Closing your Kiwisaver account will also not affect any First Home withdrawal should you return and rejoin, although if you have already withdrawn for your first home, close your account and rejoin you cannot get a First Home withdrawal again either.
Please think very carefully before you withdraw your Kiwisaver, particularly if you are only here for a short time. Should you go home, you may be selling yourself short by unlocking it later down the track when you want to buy your first home, or even in retirement. This was intended to allow people who had shifted out of the country permanently to access their Kiwisaver, not those in the UK on temporary visas.
Australian Superannuation (Trans Tasman Portability)
Australia currently allows you to transfer your Super to your NZ Kiwisaver, with a few conditions.
Once you transfer your Aus Super to Kiwisaver it will be held in two parts
– the Australian-sourced component, and
– the New Zealand-sourced component.
If you have Australian Sourced Super in your Kiwisaver, you will not be able to withdraw this early. Nor can you use this towards your First Home. Special note, if you close your Kiwisaver, you will not be able to withdraw your Australian Super under any circumstances, it will sit there until age 60 (Australian age for retirement).