[stevied20]

I have just spoken to a lovely lady at the National Insurance office and she advised me that when you have contributed to NI for 30 years then that is the threshold that entitles you to the full state pension from the UK, and she recommended that I continue voluntary contributions from NZ to the UK until I have paid up, another 8 years for me at £8.10 a week.
This is so I can receive the full state pension upon retirement, currently at £90 a week.
Is this what other immigrants have done???
What are your experiences with NI?
What do New zealand offer a new resident on retirement, or do we have to depend upon the UK state pension to be sent over upon retirement?
What would happen if I just stop paying and leave it short of the full 30 years.

Any comments would be helpful

Steve & Julie Denton

[Red Devil]

Good post Steve, I was only thinking about this myself the other night... will keep a lookout for replies :nice1

[JandM]

What would happen if I just stop paying and leave it short of the full 30 years.If you don't have the full thirty years, you get a pension that is a proportion of the full amount. (This happens to a lot of women who have breaks in their employment record because of child-rearing, homemaking, care of elderly relatives, etc.)

When you reach the age for your UK pension to be paid, you can claim it to be paid NZ. You then have to declare to the NZ authorities what amount you receive, as that will be deducted from whatever you are due from NZ. (After you gain residency, you as a UK citizen are treated AS IF you had been in NZ as far as qualifying for their benefits is concerned.) Here's a link to a site you can consult. I believe what I'm saying is right, but I'm still finding out about all this for myself. http://www.workandincome.govt.nz/manuals-and-procedures/to_or_from_overseas/reciprocal_agreements/reciprocal_united_kingdom/reciprocal_united_kingdom-10.htm

You won't receive the annual cost-of-living-linked increases to the UK pension that you would if you were resident in the UK. If you emigrate when you are already receiving your state pension, it is frozen at the rate you were getting when you left the UK. However, the NZ pension (called superannuation) gets adjusted.

[TrentBridge]

I didn't know about continuing to make contributions to make up to 30yrs, but I did find out that any payments of UK state pension you receive in NZ will not be index linked. So if there are any rises in state pension for UK residents then you won't get the rise in NZ. My understanding is that NZ govt will make up any shortfall, or maybe this will come from any contributions you have made to the system whilst working in NZ ?!!

This is my understanding of it all. Can anyone confirm please?

[TrentBridge]

There you go, JandM got there while I was dithering with my answer !:D

[JandM]

The NZ superannuation does not depend on contributions - each person gets what they are due regardless of their work record, and nobody has to pay in. An immigrant from the UK will get overall the same as a lifelong NZ citizen, part of it from their UK state pension and the rest from the NZ authorities (if it doesn't match up).

[Red Devil]

Excellent, thanks for the information JandM :nice1

[JandM]

You're welcome.:)

[stevied20]

Thanks j&m for the answers,

so am i right in thinking their is no point in "paying up" the 30 years in the uk, as the proportion i will receive from the UK will be topped up in NZ!!

If i pay up in the uk, then I just receive less from the NZ superannuation?

Steve

[Clappy]

so am i right in thinking their is no point in "paying up" the 30 years in the uk, as the proportion i will receive from the UK will be topped up in NZ!!That is the conclusion that I came to.

But, can you completely discount the possibility that you might one day return to the UK and want to claim that state pension which would be much reduced if your contribution history was not complete?

It is a difficult call because every UK government changes the rules a bit when they are in power and it is impossible to have any certainty about what the position will be when you retire.

The idea of a "citizen's pension" in the UK that is based on Residency, the same way as the one in New Zealand works, has been floated, last time by the National Association of Pension Funds in 2002 I think, but not been accepted to date.

[mgbridges]

One thing you do need to be careful of is that the UK State Pension payments kick in earlier than the NZ one - 60yrs vs 65yrs I think. You will be taxed by NZ on any UK State Pension that you receive until such time as the NZ one starts getting paid.

I'm fairly certain this is true as its something we discussed along with a whole bunch of other stuff when we met with a financial advisor earlier this week. I might not have it 100% right as my head hurt a lot by the time we'd finished talking to him! :o However he did mention another client who had been hit with a $20K tax bill because they hadn't paid NZ IRD any tax on their UK State Pension which they'd been receiving for 7yrs.

Its a minefield and my head hurts every time I start thinking about this sort of stuff!

Anneliese

[stevied20]

But, can you completely discount the possibility that you might one day return to the UK and want to claim that state pension which would be much reduced if your contribution history was not complete?

Well I am certain as I will ever be that a return too the UK is unlikely, BUT, one thing I found out today is, as long as you pay up your 30 Years before you retire (At the moment that is!!) you will still get your full state pension.

for example: I have 8 years left to pay, so I could return home when I was 58 and still have time to "pay up".
My UK retirement date has moved forward under the new system, you can check your own out at the work&pensions website, just put in your birthday and they calculate your new retirement age, mine is 66 years & 7 months boooo :(


One thing you do need to be careful of is that the UK State Pension payments kick in earlier than the NZ one - 60yrs vs 65yrs I think.

Mine will be about the same, as just mentioned!!!

And yes Annelise, you are correct, it is a minefield, you can add financial whizz to your portfolio when this is over!!

Steve

[JandM]

One thing you do need to be careful of is that the UK State Pension payments kick in earlier than the NZ one - 60yrs vs 65yrs I think. You will be taxed by NZ on any UK State Pension that you receive until such time as the NZ one starts getting paid. At the moment in the UK, women of 60 get their state pension, so this difference could affect a female who has hers but wouldn't yet be eligible for the NZ one. However, as you've mentioned, the UK system is changing, so younger women won't be able to claim their pensions as early.


so am i right in thinking their is no point in "paying up" the 30 years in the uk, as the proportion i will receive from the UK will be topped up in NZ!!

If i pay up in the uk, then I just receive less from the NZ superannuation?I believe this is true. It's your judgement call on whether it's worth topping up or not!;)

[stephenandjulie]

Ok, I know this much

NZ state pension is based on residency and not national insurance contribitions (or NZ equivalent). To be entitled to NZ state pension, you need to be a resident not less than 10 years from age 20 and 5 years of residency or more from age 50.

Also, regarding UK state pension, you can pay arrears of NI contributions for upto 6 years. So, as long as you return to UK within 6 years of arriving in NZ, you can make all your NI contributions up to date.

I hope these little bits of information help.

Julie

[JandM]

NZ state pension is based on residency and not national insurance contribitions (or NZ equivalent). To be entitled to NZ state pension, you need to be a resident not less than 10 years from age 20 and 5 years of residency or more from age 50.But because of the Reciprocal Agreement with the UK, life in the UK counts as life in NZ. Have a google for Reciprocal Agreement and you'll see.

[JandM]

Found it.


Article 10 New Zealand Superannuation by virtue of Residence in the United Kingdom

(1)
The provisions of this Article shall apply to persons in New Zealand who have been resident in the United Kingdom.

(2)
Subject to the provisions of Article 15 of this Convention, for the purpose of any claim to receive New Zealand superannuation under the legislation of New Zealand, a person who is usually resident in New Zealand shall be treated as if he had been resident there during any period when he was resident in the United Kingdom, provided that –

(a)
this Article shall not apply to any man who has not reached the age of sixty five years or to any woman who has not reached the age of sixty years, and

(b)
the person in respect of whom the claim for New Zealand superannuation is made under the legislation of New Zealand has claimed any benefit to which he is entitled under the legislation of the United Kingdom, or would be entitled if he made a claim for that benefit.

(3)
New Zealand superannuation which has become payable under the legislation of New Zealand by virtue of the provisions of this Convention, or the former Agreements, shall cease to be payable if and when the person to whom, or in respect of whom, the pension is payable ceases to be usually resident in New Zealand.

[IanW99]

Not sure where to put this (no suggestions please :D)

Taken from form SA8

You must decide for yourself whether to pay UK voluntary contributions whilst living in New Zealand. As a general rule, it may not be worthwhile paying because:

the New Zealand authorities will deduct the amount of your UK pension from any entitlement to a New Zealand pension; and if you return to live in the UK,
periods of residence in New Zealand may be treated as periods for which UK contributions were paid to help you qualify for certain benefits.

It may, however, be worth your paying UK voluntary contributions if you intend eventually to live somewhere other than the UK or New Zealand, or if you think that you might wish to claim benefits which are not covered by the agreement.

From this, you can see that the reciprocal arrangement is both ways i.e. time spent residing in NZ counts towards your NI contributions should you go back to the UK. So, if you are only going to stay in NZ or UK then it is unlikely that you need to pay any voluntary contributions.

Here's a couple of links for more information:-

SA8 form (http://www.dwp.gov.uk/lifeevent/benefits/recip_health_pdfs/2005/sa8-oct05.pdf)

NI38 form (http://www.hmrc.gov.uk/pdfs/nico/ni38.pdf)

Ian

[JandM]

Not sure where to put this (no suggestions please ):DSpoilsport!:laugh

[Carey]

Just found excellent link which explains it all. Will be printing off the helpful pdf brochure to read at my leisure!
http://www.dwp.gov.uk/lifeevent/benefits/recip_health_pdfs/2005/sa8-oct05.pdf

[IanW99]

Just found excellent link which explains it all. Will be printing off the helpful pdf brochure to read at my leisure!
http://www.dwp.gov.uk/lifeevent/benefits/recip_health_pdfs/2005/sa8-oct05.pdf

Snap, same 'form' that I posted above! Guess I should have called them leaflets :)

Ian

[JandM]

There is the equivalent one from the NZ government side which I found even more helpful, but I couldn't find that in the heat of the moment when I was posting here above.

[IanW99]

There is the equivalent one from the NZ government side which I found even more helpful, but I couldn't find that in the heat of the moment when I was posting here above.

I probably posted that previously on another thread :exit

Might be good if it was added to this thread (will have to go look for it)?

Ian

[IanW99]

Don't think that this is the link, but still has some useful info:- The Social Welfare (Reciprocity with United Kingdom) Order (http://www.workandincome.govt.nz/manuals-and-procedures/legislation/reciprocal_orders/united_kingdom_order/united_kingdom_order_contents.htm)

Ian

[JandM]

No, that wasn't the link, but I went on from that page and found it.:)http://www.workandincome.govt.nz/documents/brochures/payment-options-for-overseas-pensions.pdf (You probably did post it before, O fount of all knowledge, except what was it you said you don't do?!)

[Leanne]

Are there any Canadians who have any info about our pension plans? From what I can gather, I think that it is similar to the UK folks. I think that we are paid our CPP and the NZ pension will deduct that amount from their payments. What happens with our OAS? Is it included in that?

Never to soon to plan that retirement!

[JandM]

Here's something mentioning it - it might be a start for your research, anyway. http://www.winz.govt.nz/manuals-and-procedures/to_or_from_overseas/reciprocal_agreements/reciprocal_canada/reciprocal_canada-08.htm

[Leanne]

Here's something mentioning it - it might be a start for your research, anyway. http://www.winz.govt.nz/manuals-and-procedures/to_or_from_overseas/reciprocal_agreements/reciprocal_canada/reciprocal_canada-08.htm

Thanks for the info JandM!
:)