Dannie Fox: IVCM Australia regional manager
The NZ$1.2 billion UK pension transfer provider, IVCM, has signed with the Ralph Stewart-founded Lifetime group to act as manager for its NZ schemes rather than a buyout as reported here last week.
Dannie Fox, IVCM Australia regional head, said under the deal Lifetime would take over as manager for the two NZ products offered by the Dubai-headquartered qualifying registered overseas pension scheme (QROPS) specialist.
Lifetime will assume the legal responsibilities under the Financial Markets Conduct Act (FMC) for the IVCM PIE Superannuation (previously offered under the Brooklands brand) and IVCM NZ Superannuation funds.
“We thought it would be better to find a strategic partner in NZ rather than beef up our own operations to meet the FMC obligations,” Fox said.
She said members of the approximately $30 million IVCM PIE fund, which is targeted primarily at non-NZ residents, would transition to the Lifetime-managed entity prior to December 1.
However, the IVCM NZ Superannuation Fund, launched this April to target NZ residents looking to shift UK pensions home, would formally close and then reopen post December 1.
Fox said the non-PIE fund missed the cut to transition as a legacy scheme under FMC rules.
“To qualify as a legacy scheme you need to have at least one member,” she said. “But as at June the scheme didn’t have any members and couldn’t be listed as a legacy scheme under the [FMC] order in council.”
The QROPS provider also planned to register the IVCM NZ PIE Superannuation fund in Australia under the trans-Tasman Mutual Recognition regime, Fox said. (Last week Stewart said Lifetime would likewise register separately its recently-launched super fund, Garrison Bridge, in Australia.)
She said the IVCM NZ PIE scheme would complement the group’s Australian Ex-Pat Superannuation Fund launching this week.
The Ex-Pat fund was the first Australian retail QROPS scheme to gain approval since the UK tax department delisted all Aussie providers last year.
Fox said the Ex-Pat scheme would appeal more to those aged 55 and over looking to shift their UK pensions to Australia while the NZ-domiciled scheme would suit those under 55.
As well, she said the NZ PIE scheme (which non-residents can set at a zero-tax rate) has no contribution limits while Australian rules limit annual transfer amounts of A$180,000 or A$540,000 averaged over three years.
According to Fox, the global QROPS business was estimated to be between $8 billion and $10 billion with a reasonable proportion of that coming to Australia and New Zealand.
“There’s about 1.3 million Brits in Australia and a large number in NZ too,” she said. “It makes sense that we have rules that allow them to emigrate with their money too.”
IVCM operates schemes in Australia, Gibraltar, NZ and the UK with total funds under management of NZ$1.2 billion.