For over 20 years, Australia has been the most popular destination for British retirees seeking sunshine in the twilight of their years. However, a recent change in Australian legislation means that there is a significant cut to the amount of pension money that they can bring with them. Last month, with immediate effect, a £250,000 lifetime cap was placed on contributions paid into Australian pensions. The move was designed to stop Australians injecting large lump sums into their pension accounts, for example from the sale of a property or of a business and then withdrawing it tax free in retirement. But it is catching ex-pats as well.
Previously an ex-pat going to Australia could put up to £360,000 into a pension on arrival and then £90,000 per year subsequently. No more. The cap does seem pretty draconian when compared with the British lifetime cap of £1 million and there are hopes that the Ozzies will review the legislation and allow concessionary payments by immigrants. For now though, the Antipodes are not quite as sunny as they were.
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