Tamsyn Parker

Money Editor for NZ Herald

Transtasman super deal to kick in

Retirement savings can be moved between New Zealand and Australia from July 1 but there are conditions.

Transferred superannuation money is exempt from tax but subject to foreign exchange rate charges.
Transferred superannuation money is exempt from tax but subject to foreign exchange rate charges.

People wanting to transfer their Australian superannuation savings back to New Zealand should expect the process to take around six weeks, according to one of the country's largest KiwiSaver providers.

From July 1, New Zealanders and Australians will be able to transfer their retirement savings between the two countries as long as the money comes from and is deposited into an approved scheme.

Blair Turnbull, ASB's head of wealth and insurance, said the bank had already received a lot of interest regarding the transfer process, which received its final stamp of approval from the Australian Government on May 31.

Turnbull said it was difficult to know how many would transfer their money but about 650,000 Kiwis lived in Australia and around 70,000 Australians lived here.

"It does represent a good opportunity," said Turnbull, who will be transferring superannuation money back from Australia himself.

Turnbull said those wanting to make the transfer should start by finding out which scheme their money might be with in Australia.

"They can start by going through their shoeboxes of old paperwork."

Alternatively, people could contact their former employer or search through the Australian Tax Office website.

Turnbull said applicants needed to supply their tax file number and old statements to their KiwiSaver provider. Once the details were sent to the Australian superannuation provider, the scheme had 30 days to respond, he said.

Turnbull said that in general there would not be any exit fees or entry fees for taking the money out of one scheme and putting it into another.

The money is also exempt from being taxed. However, it will be subject to foreign exchange rate charges.

Money transferred will still be subject to the laws in the country where it was originally saved and must be kept separate.

Turnbull said Australian superannuation money was not able to be withdrawn to help first-home buyers wanting to use their KiwiSaver money but it could be accessed from the age of 60, rather than 65 for New Zealand money.

Rush to cash in KiwiSaver after law change

Some people rushing to cash in their KiwiSaver scheme before emigrating to Australia have been caught out by the short notice on a law change.

From July 1, Kiwis permanently moving to Australia can take their KiwiSaver money with them as long as it is transferred into an approved retirement savings scheme under a new transtasman arrangement.

The arrangement also allows Kiwis to transfer money left in Australian superannuation schemes into their New Zealand KiwiSaver scheme.

But until recently, New Zealanders were able to cash in their KiwiSaver money if they were permanently leaving the country.

Blair Turnbull, ASB's head of wealth and insurance, said the bank had received a rush of inquiries from people wanting to get their money out on going to Australia before the law change came into force next Monday.

Turnbull said people should not see moving to Australia as a way to get hold of their savings and urged them not to lose sight of the reason they signed up to KiwiSaver.

- NZ Herald

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