Pension mobility

troyzer

Sorry for spamming this forum so much lately but this should be the last one for a while.

I have a couple of issues with starting a pension that I wouldn't mind some advice on.

I'm 25 and when I finished my Masters in 2016, I took my first job in Australia. Over there, 9.5% of your income is deducted for super annuation as standard. When I left Australia, I was told I couldn't transfer it overseas so I had to cash it out (at a 65% tax rate). My next job was in the UK, there was an employer pension there which I signed up for and there's about a grand in it right now. I recently took a job on a short term contract with the public sector and they too also give me a pension.

I asked my current HR if I could bring my UK pension over (the UK pension provider allows this) but the HR guy said there's not much point because my public sector pension is frozen if I'm not working for them. He told me that in reality I'll have to cash it out at the end of my contract. I don't want a long term public sector job.

So my issue is that I work in an industry which will see me move around quite a lot. I have plans to move to Canada at some stage but I have been offered work in West Africa before on a FIFO basis.

I'm looking for a way I can set up a long term pension pot which is tax advantaged and mobile that I can take from job to job and country to country. I don't want to have 20 different pension pots when I'm retired with nothing in them because I was forced to cash out of half of them when I left the job/country. I want to do the right thing by setting up a pension while I'm still young and funding it properly but they don't make it easy for people like me.

Any ideas?

Henry Ford III

There's no such thing as a multi jurisdictional tax advantaged pension plan.

Are you sure you were forced to "cash out" in those places? You could have left any benefits paid up and you might have got CPI increases/investment growth over time which could have kept their value relevant.

Many people have multiple benefits from various employers and from various countries these days. Labour is much more mobile.

troyzer

Henry Ford III wrote: »

There's no such thing as a multi jurisdictional tax advantaged pension plan.

Are you sure you were forced to "cash out" in those places? You could have left any benefits paid up and you might have got CPI increases/investment growth over time which could have kept their value relevant.

Many people have multiple benefits from various employers and from various countries these days. Labour is much more mobile.

I wouldn't expect it to be multi jurisdictional. Just a fund that I can relocate when and if I need to.

I've only cashed out of one fund and I was de facto required to because my super fund in Australia didn't allow transfers out of Australia other than as cash. You're right that I could have left it there but I wanted a clean break from the Australian tax system.

As far as my current gig goes, my pension will be frozen if I don't cash out making it irrelevant in 40 years time. I'd be happy to cash it out and plow it straight into a proper fund which I could then transfer my British pension to.

Henry Ford III

troyzer wrote: »

I wouldn't expect it to be multi jurisdictional. Just a fund that I can relocate when and if I need to.

I've only cashed out of one fund and I was de facto required to because my super fund in Australia didn't allow transfers out of Australia other than as cash. You're right that I could have left it there but I wanted a clean break from the Australian tax system.

As far as my current gig goes, my pension will be frozen if I don't cash out making it irrelevant in 40 years time. I'd be happy to cash it out and plow it straight into a proper fund which I could then transfer my British pension to.

Your pension benefits will be subject to the rules of the country you live in when you retire.

Offsets may be available for any foreign tax deducted from foreign pensions dependent on the relevant double tax treaty. It's a pretty complex area. There's no need to be trying to send your pension rights around the globe in cash.

On the face of it taking a 65% hit on your Oz pension seems unwise. Why didn't you leave it there?

Small pensions as I said may be revalued or may benefit from investment growth so shouldn't be dismissed as irrelevant.

troyzer

Henry Ford III wrote: »

Your pension benefits will be subject to the rules of the country you live in when you retire.

Offsets may be available for any foreign tax deducted from foreign pensions dependent on the relevant double tax treaty. It's a pretty complex area. There's no need to be trying to send your pension rights around the globe in cash.

On the face of it taking a 65% hit on your Oz pension seems unwise. Why didn't you leave it there?

Small pensions as I said may be revalued or may benefit from investment growth so shouldn't be dismissed as irrelevant.

I was hoping there would be a non-complex way of doing things. Do you reckon I should get set up in Ireland with a PRSA and take it from there? I could move my British pension over and deposit my cashed out pension from my current gig. If I did decide to move abroad later, I would have to take it from there.

If there have been no contributions to a super fund after ex number of years it becomes dormant and reverts to the ATO. Who don't pay interest. So if I had left it there, it would have become worthless.