Australian pension idea for Gordon Brown?

With a Labour Government in Australia, the question is will Gordon Brown go looking for ideas from the land of Kevin Rudd?
Suggestions have been made in the interim response from the Henry Review that there could be compulsory government annuities. Will Gordon Brown follow with his version? The answer is probably “No” if he listens to the recommendation of Australia’s Investment and Financial Services Association (IFSA). They are concerned that such innovations could be damaging as Australia, like the UK, has an ageing population.
Would such a programme cause lower paid workers to subsidise wealthier Australians? It looks like a compulsory government annuities scheme would need Australians to dispatch all or part of their superannuation savings to the Government when they retire. And then the government would determine a permissible annual draw down.
But we all know that manual labourers do not live as long as white collar workers. So if the UK ever adopted Government-run annuities scheme, then it would be a winner for those who live longer, subsidising those who have a shorter life.
The Henry review, to which Montfort International was an overseas contributor, is ongoing review of Australia’s tax system launched in May, 2009 with results expected before December 2010.

Gordon Brown wins election – tens of thousands more Brits plan to migrate!

If May 6th voters return the current government to power, that’s not an unlikely headline according to migration experts Montfort International plc.

The UK economy is in a dire state and unlikely to improve quickly. Another five years under the dour Chancellor / Prime Minister who, according to an Oxford academic on Radio 4 last weekend, even in the good times spent more on public services than his governments received in revenues is not a prospect that appeals to seemingly an increasing number of people.

In the meantime Australia with its affluent energy sectors and long-term economic prospects has a certain lure tempting would be migrants seeking new opportunities..

Whilst Australia is not weathering the recession entirely unscathed, it has financial reserves put aside over the previous decade and more positive factors supporting its move away from economic crisis. In addition to the better employment landscape, the lifestyle, the climate and the prospects of a tax-free retirement are far better than those facing Britons remaining at home in the UK.

The Australian Bureau of Statistics reported that in June 2008 5½ million of those living in Australia had been born overseas, That’s a quarter of all Australians! Those born in the UK remain the largest group with 1.2 million Brits already calling Australia ‘home’, so new migrants have no reason to feel lonely pioneers.

For more information on the potential benefits of a life ‘down-under’ call Montfort International free on 0800 018 3571, email info@miplc.co.uk or visit their website www.miplc.co.uk. And for some Australia offers tax free opportunities in retirement using Australian Qualifying Recognised Overseas Pensions (QROPS).

Do you want a skilled visa to work in Australia?

In the UK are you a Contractor or an Employee?

Australia requires absolute clarity on this as it impacts on how you provide evidence for a skilled work visa.

The key differences include
1. Who has control over work?
Employers can direct and control employees work. The employee works in the business of the employer who manages their business as they wish.
A payer can specify how contracted services are to be performed. But control must be specified in the terms of the contract, otherwise the contractor is free to exercise their own discretion.
2. Who decides how the job is done?
An employee performs work according to his or her employment contract.
A contractor performs services as specified in the payer’s contract and only provides additional services by agreement.
3. Who pays how?
Payment is often based on time worked or on ‘piece rates’ or commission.
Payment is dependent on performance of the contract.
4. Who takes the commercial risks?
An employee generally bears no legal risks in respect of the work; since the employee works in the employers business, employers are usually legally responsible for the employees work.
A contractor bears legal risk for his or her work. They can make a profit or loss, and must correct at their own expense any unsatisfactory work.
5. Who does the work?
An employee performs the work personally with right to delegate but not to subcontract.
Unless otherwise specified in the contract, a contractor can subcontract or delegate the work.
6. Whose tools and equipment are used?
Employers usually provide tools and equipment unless otherwise agreed..
Generally, a contractor provides his own tools and equipment.

For more information contact the experts in migration to Australia - Montfort International plc on info@miplc.co.uk or 01483 202072

Alistair Darling to Target Tax Evasion

With the expected crackdown from Alistair Darling on offshore tax evaders in tomorrows budget – must come a need for IFA’s to know they are not becoming unwittingly caught up in the net. How many understand the implication of Gaines-Cooper, Double Tax Agreements, Australia and New Zealand Visas and QROPS. A lot of learning is required very, very quickly!

With heavy betting on the maximum penalty rising to 200% of the tax owed, what will the impact be of poor pension advice.

With stories of QROPS being set up with pensions for those who have no intention of leaving UK, we can see advisers caught up in the onslaught. With HMRC with increasing capability to unearth these people with Tax Information Exchange Agreements and revisions of Double Tax Agreements and footprints left by QROPS transfers. There is a growing need to check who you are dealing with if a QROPS transfer is being recommended. Please be sure to check that your adviser is registered with the Financial Services Authority.

For more information on Australia and New Zealand QROPS pension transfer advice please contact the QROPS pension transfer advice team at Montfort International on 01483 202072 or visit our website www.miplc.co.uk.

When should I seek tax and or financial advice if moving to Australia?

If your visa affects your tax status (as it does in Australia) the answer to the question has to be that you ideally need to take advice before you apply for your visa. So choosing the wrong visa or entering Australia at the wrong time of the tax year can create for you or lose you tax advantages – as well as delivering the unwanted tax bill. Even the bank account where monies leave for Australia from has tax consequences in Australia! Is it straightforward? Many raise this view however given enough time to plan ahead it can all fall neatly into place.

Many intending migrants will not be used to taking advice which doesn’t result in the purchase of a pension or mortgage or savings product, but migration financial planning doesn’t work that way. One should not assume advice of this nature, i.e. taking international tax and financial advice is for city slickers. This is a serious and potentially costly error of judgment, especially in today’s economic climate where countries are short of tax revenue. But just as tax can hit your pocket it can deliver benefits, didn’t someone once say tax doesn’t have to be taxing? Yes there are tax advantages out there – especially if you have a job offer or want to rent out your home, but these major advantages are invariably lost or eroded if planning is last minute.

It was essentially January 1993 when someone typically with a few thousand pounds in the bank and a pension with two or three years of service need not take advice before departure. It’s all changed. It’s akin to that perennial question of “Did you pack these bags yourself? If you think financials similarly you are on the right track and today’s savvy migrant will know and be eager to take advantage of the opportunities out there and pack there are financials the Australian way.

For more personalised advice phone Montfort International on 01483 202072 or visit their website - http://www.miplc.co.uk/

Top 10 financial questions for would-be migrants

When considering living outside the UK, ask yourself the following questions, say migration finance experts Montfort International plc (www.miplc.co.uk).

1. Should I sell or rent out my UK home?
2. Shares – Do I sell? Do I buy more and if so when?
3. Offshore Investment? Will it work for me?
4. Pension Funding - When do I stop contributing or when do I put more in?
5. Do I transfer my Pension Fund and if so, when and to what?
6. Can I control the foreign exchange rate I get on the money I transfer and if so how?
7. What happens if I don’t like my new land and decide to come back?
8. Should I have a UK Income Protection policy or a local one?
9. UK State Pension? What do I do?
10. Life Policies. Should I cancel them before I go – what do I do?

Whatever your financial intentions, seeking guidance early from the qualified advisers at Montfort International (info@miplc.co.uk or freephone 0800 018 3571) before you finalise your migration plans can help you to a more comfortable life abroad.

Australia wants more immigrants

On 30th July 2008 Andrew Metcalfe, Secretary, Department of Immigration and Citizenship told the Australian Government Policy Evolution Conference at Canberra that in the last financial year (1/7/2007 – 30/6/2008) over 158,000 migrant visas were granted including 110,000 visas for temporary skilled work. Citizenship was granted to nearly 170,000 people.
His Department wants the migration program to supply skilled labour so that economic growth can continue within “a longer term framework for migration in the context of future labour market and demographic needs”.
The Migration Program for the current year (July 08- June 09) increases to 190,000 places, which makes it the largest program ever. The skilled migration component will make up 133,500 places, the largest ever and a 30 per cent increase on last year's program. The family stream will also grow by 6,500 places to total 56,500 places.
If your intention is to take advantage of the increasing number of opportunities to migrate to Australia, seek advice early from the qualified visa and financial experts at Montfort International http://www.miplc.co.uk/integrated_visa_financial_advice.html (info@miplc.co.uk, call 01483 202072 or freephone 0800 018 3571).

Top up your pension before you go,go (Downunder)

If you are considering migration to Australia you have probably wondered whether you should transfer your pensions overseas, but what you might not have considered is whether you should top up your pensions whilst still earning a UK salary. Higher rate tax payers will receive 40% tax relief on their contributions in the UK and if you subsequently transfer the plan to an Australia superannuation fund, you will be able to access the funds 100% tax free from the age of 60. This represents an effective return of 66% on your investment in addition to any growth in your fund in the meantime!
This may sound too good to be true, but seeking advice early from migration finance experts Montfort International plc (www.miplc.co.uk) before you finalise your migration plans can help you to maximise your finances ‘Down-under’.
There is no similar incentive to invest after tax income into Superannuation in Australia; which is why it is recommended you consider your Retirement Provision before you start packing any bags. Although there is no cap on contributions to UK pensions, there is a limit to the amount on which you receive tax relief (the higher of £3,600 or 100% of earnings to a maximum of £235,000).
Whilst it makes sense to add to your pensions before you migrate, some people will be more interested in getting their money out. If you transfer your UK pension funds overseas, in certain circumstances it is possible to access 100% of your funds as a lump sum after being non-UK resident for 5 consecutive UK tax years.
Whatever your financial intentions, seeking advice early from the qualified advisers at Montfort International (info@miplc.co.uk, call 01483 202072 or freephone 0800 018 3571) before you finalise your migration plans can help you to a more comfortable retirement ‘Down-under’.