In 2006 the United Kingdom relaxed some of the rules regarding the migration of UK pension funds. The change allows most UK citizens who migrate to another country, including New Zealand, to transfer their UK pension funds to a Qualifying Recognised Overseas Pension Scheme (QROPS) in the country to which they have migrated. After a period of time, the taxpayer can access the funds without a penalty being imposed by the UK revenue authorities.

We understand from discussions with the Inland Revenue Department that New Zealand has been the new home for approximately 300,000 migrants since the introduction of the New Zealand foreign investment fund (FIF) regime in 1992.

The FIF rules tax overseas retirement funds in advance of the funds being distributed. The result is often harsh annual tax charges on the overseas superannuation assets in terms of both the overseas currency swing against the NZ dollar and the value growth within the fund itself. The regime has strict compliance and notification rules and severe penalties for non-compliance. It is a productive audit ground for the IRD.

In the past, many individuals holding UK-based superannuation interests were in the fortunate position of being eligible for a number of exemptions from the FIF regime which are based on the taxpayer being prohibited from cashing in their foreign superannuation prior to reaching retirement age. However, with the entry into force of the UK’s QROPS legislation in early 2006, it is now possible in many cases for a New Zealand resident who has a UK pension scheme to cash it in. This ability to cash in the pension early means that one of the FIF exemptions previously available before the UK QROPS changes is no longer available. The upshot of this is that an individual living in New Zealand is now likely to be subject to New Zealand tax on their UK retirement funds.

It is important to note that the loss or otherwise of the New Zealand exemption does not depend on whether there is actually a transfer to a New Zealand QROPS. The fact that such a transfer is possible is enough to remove the availability of the exemption.

The news is not all bad, however, as in some cases an individual may have a loss in respect of their UK pension which in some income years can be used in New Zealand to offset other income such as salary. For example, the global financial crisis and the devaluation of the pound sterling against the New Zealand dollar over the past few years means that most United Kingdom pension assets will have suffered economic losses as calculated under the New Zealand rules.

At 1 April 2007 some major changes to the New Zealand rules were introduced. These were mainly in relation to overseas shares and the introduction of the 5% fair dividend rate method. However, one important change for investors in overseas retirement funds was the relaxation of the rules which previously prevented the offsetting of losses against other income. From 1 April 2007 to 31 March 2009 losses arising from overseas superannuation investments as calculated under the comparative value (economic value change) method could be offset against any other income. This ability to use losses was then removed with effect from 1 April 2009; however, the two-year window remains.

Taxpayers who hold interests in UK pensions that can be transferred to a New Zealand QROPS should realise that they are likely to be subject to the New Zealand regime from 6 April 2006 whether or not those interests are actually transferred. Accordingly, taxpayers should check to ensure that their circumstances continue to meet the conditions of any exemptions on which they relied prior to 1 April 2006. Taxpayers who are concerned about this issue should contact the writer to discuss their obligations and the possible tax refund upside through the loss of value that they have likely suffered during the period from 1 April 2007 to 31 March 2009.

This exposure to the New Zealand FIF regime may encourage those taxpayers to consider/reconsider moving those interests onshore into a New Zealand QROPS, to remove the New Zealand FIF exposure for years following the year of transfer. Anyone considering such action should seek independent financial planning advice well in advance of any decision.

As part of the “World is coming to Napier 2011” campaign, which focuses on the 2011 Rugby World Cup, “Sister Love” celebrates Napier’s Sister City relationships around the world.

The prize includes:

• return airfares for the lucky sister and partner from anywhere in the world to Napier City
• domestic airfares to bring the NZ sibling and his/her partner to Napier
• 10 days’ luxury accommodation
• and the winners will be given the Keys to the City, to enjoy the wonderful attractions on offer in Napier including Art Deco tours, wineries, waterside restaurants, inner city cafes, sightseeing, and more.

The competition closes end February 2011 and both the sibling in New Zealand and the sister overseas may enter. Entry is via the website www.Napierlife.com.

The view apart, twenty-six hours had taken their toll and I felt a little subdued as I navigated the combined forces of Customs, Biosecurity and Immigration. However, as I exited the terminal and headed into a cloudy but warm Auckland afternoon, I couldn’t help smiling: I was about to begin a trip that I had been planning for a good long while, one that could change our family life dramatically. Wondering if I could pull it off and whether the outcome could be as good as we have hoped, I pulled my hire car into the traffic on Highway 20A and headed north to Auckland.

Once settled into my motel room, I picked up my contacts book to make a few calls. One of the things I did in preparation for my trip was harvest as many Kiwi contacts as possible from friends and colleagues so I could meet local folks and get a feel for normal family life in New Zealand.

Linda and Gideon were just such folks and, when I rang to introduce myself, Linda immediately invited me to dinner and drove over to pick me up. After the requisite introductions, I was whisked away on a brief tour of the delights of Tamaki Drive and Mission Bay whilst Linda remotely organised the family preparing the evening meal back home via her mobile phone.

Given that I was the previously never mentioned husband of a friend of a sister, Linda along with husband Gideon and their children Susie, David and Amy were gracious in their hospitality and I enjoyed their company over a pleasant dinner. As they had sagely prophesied earlier, the minute the meal hit my system and I sat back in the living room with a cup of tea – having eschewed alcohol since London – my eyes grew heavy and I started to lose the thread of the conversation.

As the minutes passed, my mind seemed to be undergoing a gradual shutdown and the harder I tried to concentrate, the more elusive clear thought became. Spotting my declining mental and physical state, my kind and understanding hosts simply guided me to the car and drove me back to my lodge. Once there, it took all my will power to stay awake long enough to make a slurred “good morning” call to SWMBO and the sprogs before hitting the bed like a redwood toppled by a lumberjack’s axe. So, on my first day in a country that I have long planned to visit, my first impression was the dent I left in the mattress.

Far from being the “England on the other side of the world” I’d been led to expect, the wooden houses and wide tree lined asphalt streets of Auckland’s suburbs reminded me of the small-town America I had seen on my trips to Virginia. However, the tall palms and pohutukawa trees, the voices of the locals and the cars driving on the left all made it clear that New Zealand was very different and very not-anywhere-else.

The hot and humid weather with brief tropical showers was very pleasant when not wearing a suit and tie although the sun was deceptively strong, as my pink forehead soon proved. It seemed that, other than a few backpacking Brits I saw, I was the only person in the city who didn’t have a tan. The weather in New Zealand seems to engender the easygoing relaxed demeanour that I found in almost every person I met.

When I jumped aboard his bus for the third time that day, to head back into the CBD after a dash back to the motel for papers, a walrus-moustached Maori driver looked over his mirror shades at me, raised an eyebrow and said, “Forget something, mate?” before cracking a wide smile. This attitude and behaviour is beguiling because it seems more mellow/less brash than the directness of the neighbouring Aussies.

Observing folks on the streets, in stores and in bars and restaurants, I notice that society here seems to be a little more balanced than elsewhere, with young and old, European and Maori mixing without the class-ridden self-consciousness of the Brits or the status symbol awareness of the Americans.

With this in mind and after a couple of beers to take the edge off our thirst, I ambled down the hill in the company of Steve, the father of a friend and colleague back in London, past well-attended touch rugby and lawn bowls competitions, to take my first ever swim in the Pacific.

Warning Steve that exposing my pale European flesh had been known to cause children and women to scream in horror, we piled our shirts and towels on our shoes and waded out through the gloriously warm shallows until we were able to dive in and swim amongst the moored yachts and families kayaking back and forth.

Most of the bays around Auckland seem to cater well for those seeking respite and relaxation in the evenings and weekends, with tree-shaded grass, clean showers and toilets and picnic tables for those choosing to dine al fresco. Watching families having their evening meals and few “cold ones” whilst watching local biathletes compete nearby, it is hard not to be seduced by it all and imagine that life here is always like this.

That said, the Kiwis seem far more geared up for such things and although New Zealand has very low unemployment at this time and an increasingly energetic economy, one senses that here, the “work to live, don’t live to work” ethos is well and truly engrained in the national psyche. It is our hope that, as a family, we will be adopting this very mindset when our dream of emigrating becomes reality later in the year.

Fed up of long hours and “chasing his tail” to pay the mortgage, Steven had been trying to persuade Hayley to move abroad. Steven had heard about New Zealand from a Kiwi friend and had fallen in love with the look of the country after having seen television footage of the country some years ago when NZ hosted the Commonwealth games.

Hayley had trained as a Montessori teacher and knew that this held an open ticket into many countries, as this was a profession with not enough trained teachers. Hayley found the recruitment site of the NZ national organisation for her profession online and soon had established contacts with schools in New Zealand looking for staff.

After checking the NZ immigration website for entry requirements, she knew that she would qualify for a work visa. However, she was reluctant to confirm a job offer before she had visited the country to see if she liked it enough to stay. Determined to have a lifestyle change, whether or not NZ suited them, the Robertsons put their UK house on the market. They arranged a flight with a changeable return ticket so that they could come back again if they didn’t like it. Their house quickly sold, so they packed all of their belongings into a container so that it could either be shipped if they decided to stay or safely stored until they came back home.

The children were upset at having to leave the family pets behind. The two cats had been found good homes with family friends but they could not bear to be departed from their English Springer Spaniel dog who was despatched down to granny’s in Devon for dog-sitting until they had reached a decision about where they wanted to be.

Hayley had decided that as they were coming out initially to see if they liked the country, they would not apply immediately for a work permit. A visitor permit was stamped into their passports, enabling them to stay for six months but this meant that they could not be employed. After staying in a central Auckland hotel for a few days to get over their jet-lag, they hired a camper van to tour around in. Steven was relieved to find that Yellow Pages also published in NZ and that he was able to shop around for quotes for the camper van hire and for better hotel accommodation, seeing as the initial motel booked over the Internet before they left was a disappointment.

“It was quite unnerving, arriving in a country with our two children and all of our worldly possessions left behind in a container. However, it was also quite liberating – not having a fixed home address and being able to travel around at our own pace, choosing our destiny rather than following our normal humdrum routines,” Hayley told us.

She had decided to home school the children whilst they were travelling around New Zealand but also felt that travel was an education in itself and made the most of the opportunities in each place of stay, taking in museums, cultural performances and volcanos. The children even experienced their first mild earthquake, which they mistook for feeling “woozy” with jetlag until a local Kiwi pointed out what the slight swaying motion actually was.

Before setting off for NZ, Hayley had secured a job offer from a pre-school in Hamilton and had arranged two interviews in Auckland and Wellington. “Touring around the country in the camper van gave us the opportunity to see where best suited us as a family.” Steven is a tradesperson and knew that he should be able to pick up work fairly easily if based near a large enough town.

Whilst touring around the Waikato area, the Robertsons stayed at a small seaside community on the West Coast called Raglan. They fell in love with the beautiful scenery. Raglan is famous for its left-hand surfing break and attracts a young surfy crowd during the summer months and has quite a lot of artists and musicians based there. It was a 45-minute drive into Hamilton so Hayley decided that she would accept the Hamilton job and she would commute each day.

“My boss couldn’t believe that I was willing to travel the 40km into work each day but after being brought up in London, the drive sure beats being crammed onto a tube train with somebody’s sweaty armpit in your face. The drive is relaxing – over a stunning hill top, a natural reserve with views on the way home to Karioi mountain. It’s only when I hit Hamilton that I experience the 15 minutes of traffic and this is nothing compared to what I was used to even doing the school run in the UK,” Hayley said.

After six weeks in a camper van, the family felt that they needed a base and to make some decisions. The choice of Hamilton also meant that Hayley was virtually guaranteed a work visa as her profession was listed under the immigration “job skill shortage” list for that region. She located the local immigration office and, supported with a written job offer, applied for a work visa. This however took several weeks to be issued and she was unable to work during this time as her visa was not valid. They rented a small house right on the beach for around $250 a week.

“We were quite shocked at the standard of the accommodation as this was an original 1950s ‘bach’ or beach house and it was very basic, although in an amazing position with beach access. We found most agencies were only interested in longer term lets and we only wanted to rent for a few weeks whilst we were looking for a house to buy.”

House hunting was a slightly different experience from that in the UK. In Britain, you may see an advert or picture of a house in the estate agent’s window, go in and get comprehensive house details and after reading them, make an appointment to view the property. In New Zealand they pride themselves in how “easy” it is to buy a house, but the Robertsons were quite shocked at the difference in the buying process. “We walked into a real estate agent’s office and asked for the details of one particular house we liked the look of. They looked at us as though we were slightly mad. They do not usually have much printed information or details of the property available and the chances are that the agent you deal with may never have even visited the property before unless it is one of their personal listings.”

In New Zealand, in many real estate offices, each person is an individual salesperson and the way the commission usually works means that they would benefit far more financially from selling a house that they have personally taken onto their books rather than selling a listing from one of their colleagues from the same company. However, the industry is regulated with each office having to be licensed and a principal for each branch holding the AREINZ qualification.

It would pay to build up a rapport with one good, well-established agent, as they do have the same reputation as second-hand car salespersons in the UK. “We were shown around several houses where the agent had never been inside before and had no knowledge about but were just showing us everything they had on their books in that price range.”

Advice on buying a home can be found through the Real Estate industry website but in general, do not sign a contract until you have had a solicitor check it over. Houses here are negotiated by way of contract. An initial contract may have clauses such as “subject to you securing finance” or “a satisfactory LIM and building report”.

Once these matters have been resolved the contract goes “unconditional” and you are tied in to buy the property. Buying at auction is becoming more popular in New Zealand but you must make sure that all of the necessary pre-checks and reports are done and your finance is in place before raising your hand to bid. Solicitors’ costs vary and average between $800 – $1500 for straightforward conveyancing for buying a property.

Real estate agents have seen house prices pushed up with high immigration, particularly from the Asian market, and although immigration has dropped over the last eighteen months the real estate prices are still buoyant. “Being able to get more for our money was a huge attraction. We were lucky that the exchange rate was very favourable when we arrived, although the NZ dollar has since strengthened. This meant we could buy a house outright with no mortgage with the money we had made on our UK property. Our home cost $296,000 two years ago and is now valued at $490,000 as the town we bought in hit a price boom. We have since been able to borrow against this property and have taken a large mortgage to buy a second “rental” home in the city so we can get a footing into the right high school catchment zone for our eldest daughter.”

© Alison Harlow 2005

Maternity services in NZ are a bit different from those in the UK.

I know more about Independent midwives than other maternity carers so my information is a bit biased in their favour.

Most women are cared for by midwives throughout their pregnancy, birth and post-natal care. Midwives in NZ do all the stuff that GPs do in the UK, ie prescribe medication, refer you to a radiologist for scans, take blood samples etc. Very few GPs attend births any more. The government brought in new legislation a few years back which gave more choice to women; GPs weren’t happy with this and their now reduced income so stopped attending births.

If you are a resident then all care is free, unless you want an obstetrician, then they will charge. If you develop problems in your pregnancy, your midwife will refer you to an obstetrician – there’s no charges associated with this.

You have three choices of location to have baby: home, maternity hospital, and base hospital. If you have baby at home, or maternity hospital, there is a limited range of drugs you can take during labour, eg you can’t have an epidural. But there is less chance of intervention with drugs etc.

Alternatively you could have baby in a base hospital, which is a large general hospital with a maternity ward, neo-natal units etc. If you develop any problems during pregnancy/labour you’ll probably be transferred to a base hospital. A base hospital is also the only place where they do Caesareans.

These will all depend on whereabouts in New Zealand you are living and who your maternity carer is.

You have basically two choices of midwife: an independent midwife or a hospital midwife.

If you have an independent midwife, you will see her for your ante-natal and post-natal visits, and she will attend the birth. An independent can deliver your baby at home, in a maternity hospital or in a base hospital, depending on the contract she has with the local hospitals. Most independent midwives are members of the New Zealand College of Midwives, which regularly reviews the midwife’s practice every couple of years.

The independent midwife will normally work in some sort of team arrangement, so she has someone else who can be there if she is unable to see you at any given time. The ante-natal/post-natal visits will be either at your home or the midwife’s clinic and the midwife will stay with you throughout the whole of your labour. If you are having your baby at home then there will normally be two midwives present, your primary midwife and a colleague.

Hospital midwives are at the maternity hospitals and base hospitals. You will normally be assigned to a team of midwives, whom you will see for your ante-natal/post-natal visits. I think these are normally done at the hospital. When you go into labour, one of the midwives on your team will attend you. The downside is that if your labour is long then you may go through several shifts of midwives and so several different midwives.

GPs and obstetricians normally work with a team of midwives. The midwives will do the majority of the visits and stay with you during labour. The GP/obstetrician will probably arrive some time around when the baby is being born…or after.

Where to find a midwife

Domiciliary midwives, hospital-based midwifery services and independent midwives are listed under “Hospitals and other Health Services” at the front of the telephone directory (“White Pages”).

The Maternity Services Consumer Council has information on finding a person to care for you in pregnancy and childbirth: phone (09) 520 5314 or email: mscc@maternity.org.nz

The New Zealand College of Midwives can also help you find a midwife. Write to NZCOM, Box 21 106, Christchurch, or phone (03) 377 2732 or email nzcom@nzcom.org.nz

More information can be found on these websites:

New Zealand College of Midwives
New Zealand Government