There are many reasons why you may want to transfer your pension, such as you might be changing your job, your pension scheme might be closing or wound up and many other reasons as per you. Thus, you should know everything about transferring your pension with UK pension transfer process.
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Things To Do Before Transfer
Before you go for transferring your pensions or a part of your pension from one steam to another you need to be sure about the following things,
- The pension amount from the scheme which you want to transfer should allow you to transfer. You cannot transfer if the existing pension scheme you have doesn’t allow you to transfer the payment.
- The scheme in which you are going to transfer the fund must also accept the funds from other pension schemes.
- You have to make the payment of the fees.
- You have to lose some of your rights which are, right to take pension at a certain age, right of fixed or enhanced protection that you had when you transfer the funds.
You will get you to know more about this from your pension providers.
Charging Of Tax When You Transfer
You will be charged a twenty-five percent tax if you are not living in the UK, Gibraltar or EEA. Otherwise, you won’t be charged any tax. You can get the refunds on your taxes if you move to any of these countries in the next five years. To get this tax refund benefit you have to contact the administrator of the pension scheme. Also, you can’t move out of these countries for the next five years or you have to pay the tax amount of 25% on your pension transfer that you made before.
The reason for transfer
There are many reasons why you may have to UK pension transfer from your existing pension scheme to others.
- You might be changing your job.
- The scheme in which you are first enrolled is now closing or wound up.
- You may want to choose a better pension scheme.
- You might have the pension schemes from more than one job, and now you might want to integrate them.
- You are moving out of the country thus also wants your pension scheme to be transferred in that country.
These might be the possible reasons you might have for transferring your pension scheme but you need to keep in mind that you also have to make payment of the tax for every transfer. Thus, you must know about these things. You need to keep in mind what it requires to transfer your pension scheme from one to another thus you should keep in mind these things.