A large percentage of migrants that enter Australia each year come from the UK. Indeed, around about 30,000 of the migrants that enter Australia each year come from the UK, according to a study in 2008. Putting this into perspective, this is more than New Zealand migrants to Australia (around 27,000) and those from India and China (around 22,000 from each country).
For those UK migrants living in Australia many of them would have UK pension benefits held in the UK. Should a UK expat pension member in Australia transfer their UK pensions to Australia?
Whether a UK pension transfer to Australia is a good idea or not is a big issue, not just for a UK expat pension member but also for a returning Australian that has returned to Australia after a period of work in the UK.
The benefits from a UK pension scheme can vary. This is because historically the UK has a variety of pensions that provide different benefits. For example, a final salary (defined benefit) scheme is not a common type of scheme throughout the world. The benefits from this type of scheme depend on the years of service an individual has from their employer, their final remuneration and the scheme accrual rate. This is unlike an Australian scheme where benefits depend on the fund size at retirement – where there are no guarantees.
If you are a UK expat pension member of a final salary scheme how can you compare two totally different types of benefits, in two different countries, in order to decide whether a pension transfer to Australia would be advantageous or not?
The advisers at UK based IFAs Global QROPS Ltd have many years of experience advising on pension transfers to Australia from the UK and can make firm recommendations to UK expat pension members in Australia deliberating on what to do with their UK pensions.
