Crackdown on UK-NZ pension transfers

The UK's tax department Her Majesty's Revenue and Customs (HMRC) has proposed big changes to the Qualifying Recognised Overseas Pension Schemes (QROPS), which are used by expatriate Britons who want to transfer their UK pensions over to their new country.

There are roughly 3000 QROPS schemes in nearly 50 jurisdictions worldwide, including about 60 in New Zealand.

As well as introducing new rules around the tax treatment of QROPS, the HMRC is looking to ensure pensions transferred to other countries are actually used for retirement.

The draft rules say that pension schemes established in New Zealand "have been used to allow individuals to take their pension savings as a lump sum."