NHS Pensions move to Australian Superannuation

 

UK pension rules change from April 2015 which may have a significant effect on you.

As it stands, anyone that has accumulated benefits in a UK defined benefit pension scheme can transfer their benefits across to a Australian superannuation fund provided certain criteria is met. Once transferred, you are then able to benefit from the generous tax regime and flexibility afforded to Australian super funds.

Many public sector defined benefit schemes, such as the NHS, are currently unfunded. This is where the current membership and employer pay contributions which in turn are paid as pensions to retired members with any shortfall made up by the Exchequer. As there are no funding strategies or assets available to pay for the transfer off benefits out of these schemes the UK Government will introduce legislation which will ban transfers out of these unfunded schemes to protect the Exchequer and wider economy.

Unfortunately these changes will affect the majority of public sector schemes such as the NHS and therefore members of this scheme will not be permitted to transfer from April 2015.

As an expat with benefits accumulated in a defined benefit scheme it is important that you take stock of the forthcoming changes now. You may have been considering transferring your pension previously but have simply not got round to doing it yet.

It is important to understand that in order to transfer your benefits, you firstly need to obtain a guaranteed transfer value. By law, a pension scheme has up to three months to produce a transfer value and therefore if you are interested in transferring your pension to Australia, it is important that you act now.

 

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