uk state pension

[dragon56]

Hi
I qualify for UK state pension next month and am struggling to work out what to do for the best.
It is not an enormous amount and I plan to carry on working part time in NZ (about £115.00).
As I understand things I can opt to have this remitted direct to NZ government and collect NZ superannuation which has the benefit of no hassle. On the other hand I believe that if I have it paid into a UK account it won't attract tax for 4 years but I am not sure if I can still follow the first option after those 4 years. To add to my confusion and struggle to find the best option is the fact that if I take the pension direct from UK then it is frozen at the point I draw it (I think)so would tax saved be more or less than annual increments I might otherwise receive??

HELP!!

[Duncan74]

Seek proper advice from a professional. It's very complex, highly dependant on your personal situation, and getting it wrong could cost you tens of thousands.

[dragon56]

Seek proper advice from a professional. It's very complex, highly dependant on your personal situation, and getting it wrong could cost you tens of thousands.

Thanks for your prompt response, much appreciated.

Advice from a professional (chartered accountant) in UK which I followed against my better judgement just because he was qualified did cost me not tens but hundreds of thousands so I don't have your unqualified faith in them Duncan. I will ultimately use an accountant but I want to have as much knowledge as I can gain first and feedback from others who might be or have been in a similar position will be invaluable.

[Duncan74]

I agree there's a need for prudence, but personally then I'd find a recommended advisor (use the search, been asked before and various names suggested), get their advice and then check out their recomendations. So doing things in the opposite way to you. Advantage is that you can focus in on the specific issues related to the suggested path, but the disadvantage is that you may not be made aware of a 'better' way.

[JandM]

On the subject of the annual increments, I don't think you, living in NZ, will get any at all, whatever you choose to have done with the money. I don't think it's a question of where the money is that determines this, but where YOU are.

Here's an old thread with some discussion on the matter. http://www.enz.org/forum/archive/index.php/t-20731.html

[IanR]

I see that the UK government have just been pushed by the EU into increasing the basic pension from circa £97 a week up to £140 - unfortunately they're dragging their feet and only say that this will be done before the end of the current parliament in 2015.

As I qualify for a state pension in 2013 I'm wondering whether I can :

a. Just have my pension paid into a UK account until 2015 ?
b. Delay taking my pension until 2015 (as I could in the UK with a resulting higher weekly pension)?
c. Keep a UK address for payment (assuming I do get residency prior to 2015)?

[dragon56]

I see that the UK government have just been pushed by the EU into increasing the basic pension from circa £97 a week up to £140 - unfortunately they're dragging their feet and only say that this will be done before the end of the current parliament in 2015.

As I qualify for a state pension in 2013 I'm wondering whether I can :

a. Just have my pension paid into a UK account until 2015 ?
b. Delay taking my pension until 2015 (as I could in the UK with a resulting higher weekly pension)?
c. Keep a UK address for payment (assuming I do get residency prior to 2015)?

From my research so far:

a. You can of course have your pension paid into a UK account but it will still count as income as far as NZ IRD are concerned, the main advantage would be that you could then transfer it when exchange rates suit you.

b. I did consider this option but as your frozen UK pension falls behind then thanks to a reciprocal arrangement it is topped up by NZ to equal Superannuation rates so there is not a lot to gain.

c. You could be on thin ice if you didn't declare that you were actually living in NZ they probably wouldn't look too kindly on someone using an accommodation address to gain extra pension. having said that it would need someone far more expert than me to comment on the legality of such a move.

thanks for the link JandM very useful

re increments, I was aware that I would get none from UK, I was referring to the Superannuation top up and assuming that it would (more or less) keep pace with inflation.

Thanks for the feedback, much appreciated

regards all

Duncan

[JandM]

Oh, I see what you mean now.

I THINK, but I can't now track a source for this impression, that if you use the 4-year tax holiday in the way you describe, you can afterwards change to the other scheme (having your pension paid to the NZ government and receiving NZ Superannuation).

In trying to find a reference, I've come across this page, which may be useful to someone finding this thread in the future. (I expect you've already found it.) http://www.workandincome.govt.nz/ind...n-nz-faqs.html

[dragon56]

It is not so much "an impression" as something I am trying to get some info and feedbackon, hence my original post.

Thanks for the link, I had got it but I don't think it hurts to post such useful links again.

regards

duncan

[JandM]

Sorry, I was meaning that I have the impression that I have seen somewhere that if you use the 4-year tax holiday, you CAN afterwards change to the other scheme. But so far I haven't tracked a source, I'm afraid.

I hope someone will show up who has the actual know-how.

Edited to add - I see there are contact details given on the government website, if you wanted to ask them directly. http://msdsupport.custhelp.com/cgi-b...wmcF9wYWdlPTE*