Tax on foreign superannuation transfers

If you transfer a lump sum from a foreign superannuation scheme while you're a New Zealand tax resident, that lump sum can be taxable under New Zealand's foreign superannuation rules.

New migrants and returning New Zealanders usually get a 4-year exemption period from the date they become NZ tax resident.  Lump sums received within that period are generally exempt from NZ tax.  This exemption doesn't apply to a regular pension paid from a foreign scheme — that's typically taxable in full when received.

Once your UK pension has been transferred, tax on future growth is handled automatically through your NZ QROPS fund.  The tax question relevant here relates to the period between the end of your 4-year exemption and the date your pension is actually transferred to New Zealand.

For current, authoritative detail, on what tax may be applicable see the IRD website with guidance on foreign superannuation.   The IRD also have a Fact Sheet on Foreign Superannuation (IR1024), which can be downloaded here.

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