The Kiwi Wealth Super Scheme ceased to be a QROPS at the end of 2023. It closed to new members and gave its investors only short notice of its intention to wind up on the last day of the year. Subsequently, GBPensions has received a few calls from former members of the scheme. Therefore, we hope this blog provides some helpful context.
Having closed to new members on 3 October, the Kiwi Wealth Super Scheme wound up on 31 December 2023. On its website, Fisher Funds, the scheme’s owner, blamed this decision on low uptake:
“With the introduction of KiwiSaver in 2007, demand for non-KiwiSaver retirement schemes such as the Kiwi Wealth Super Scheme (Scheme) has declined.”
It also stated at that time that the scheme: “will operate as usual up until 30 November 2023. Withdrawals and transfers out of the Scheme will continue to be processed as normal until this date. Contributions into the Scheme will continue to be processed up until 31 December 2023.”
What does this mean for people who transferred their UK pension into the Kiwi Wealth QROPS?
From 4 October 2023, the Kiwi Wealth Super Scheme stopped being a Qualifying Recognised Overseas Pension Scheme (QROPS).
Depending on their age, members who transferred their UK pensions into it had a couple of options.
If they’re aged 55+, the investor could withdraw their Kiwi Wealth funds (e.g., into their bank account) and then reinvest (or not) as they wished. Alternatively, they could have transferred the funds directly into another superannuation or retirement scheme.
If they were not eligible to withdraw their transferred UK pension pot (i.e., had not yet marked their 55th birthday), the investor had to transfer this to a QROPS.
The UK Government won’t impose any extra penalties due to the scheme losing its status as a QROPS.
There could, however, be the potential for other UK surcharges or tax implications on withdrawn funds. Everyone’s circumstances are slightly different, which is why GBPensions always recommends seeking specialist tax advice as part of any decision related to a UK pension transfer.
This instance is no exception.
All investors had to complete the Kiwi Wealth Super Scheme wind-up form online, telling the scheme’s administrators of their decision, ideally before 30 November.
What happens if a member of the scheme missed the 30 November deadline?
The first thing is not to panic. Investors’ Kiwi Wealth funds are as secure as they were before any wind-up announcements.
However, suppose a member didn’t inform the administrators of their decision to withdraw, transfer, or reinvest before the end of November. In that case, they need to wait until the wind-up process has been completed. Kiwi Wealth expects this to take approximately three months (the end of March 2024).
‘I transferred my UK pension to Kiwi Wealth. Can you help me decide what to do next?’
Yes! If you’d like to chat about your options, please get in touch with GBPensions.
Our director, Tony Chamberlain, is amongst the most qualified financial advisers in New Zealand, holding Certified Financial Planner (CFP), Chartered Life Underwriter (CLU), and Accredited Investment Fiduciary (AIF) credentials. Moreover, GBPensions does not operate its own QROPS, so there’s no “ulterior motive”. You can be sure of objective, independent advice to help you make a genuinely informed decision. We can also connect you to tax experts familiar with both the UK’s and New Zealand’s tax regimes.
