Thinking about crossing the pond? If you are moving permanently or indefinitely to Australia, you may be eligible to transfer your retirement savings from a KiwiSaver scheme to a participating Australian super fund.
However, there are important rules and conditions to consider before making the transfer.
Checking Fees and Requirements
Before transferring your KiwiSaver savings, check with both your KiwiSaver scheme provider and your chosen Australian super fund to determine if any fees apply. Additionally, you will need an Australian tax file number (TFN) to complete the transfer process.
Information Required for Transfer
Your Australian super fund may request specific details from your KiwiSaver scheme provider, including:
- Whether the transferred amount includes Australian or New Zealand-sourced funds
- Any tax-free components of an Australian-sourced amount
- Amounts not previously counted towards the non-concessional contributions cap
- Restricted or unrestricted non-preserved amounts
Your KiwiSaver scheme provider should supply these details to ensure the Australian super fund accepts the transferred amount.
Conditions for Transfer
Transfers from a KiwiSaver scheme to an Australian super fund are subject to several key conditions:
- Full Balance Transfer: Partial transfers are not allowed—you must transfer your entire KiwiSaver balance.
- Contribution Limits: New Zealand-sourced retirement savings transferred to an Australian super fund are treated as non-concessional (or personal) contributions. These contributions count towards the non-concessional contributions cap, and exceeding this cap may result in excess contribution penalties.
- Super Balance Impact: Your total superannuation balance in Australia influences how much you can contribute in the future.
Eligible Funds for Transfer
Transferred KiwiSaver savings can only be sent to a complying Australian super fund regulated by the Australian Prudential Regulation Authority (APRA). Self-managed super funds (SMSFs) are not eligible to receive KiwiSaver transfers.
Tax Treatment and Withdrawal Rules
A KiwiSaver transfer to an Australian super fund is not taxed. However, withdrawals from your Australian super account remain subject to release conditions. Transferred funds are split into two components:
- Australian-sourced component: Can typically be accessed tax-free at age 60, provided you meet the Australian definition of retirement.
- New Zealand-sourced component: This can only be accessed when you reach New Zealand’s retirement age, currently 65.
Transferring your KiwiSaver savings to Australia does not count as a tax-deductible personal contribution, nor does it qualify for government benefits such as the super co-contribution or spouse contribution tax offset.
By understanding these rules, you can make informed decisions about managing your retirement savings when moving to Australia.
