Foreign Superannuation Funds Transfer tax changes from 1 April 2026 

Key changes 

Starting on 1 April 2026, if you’re moving your foreign superannuation funds (including UK pension funds) into a New Zealand superannuation scheme you can choose the ‘Scheme Pays’ option to meet any Inland Revenue tax liability resulting from the foreign superannuation transfer. This allows you to elect for the Scheme to pay tax owed to Inland Revenue directly from the transferred pension funds at the transfer scheme withholding tax rate of 28% (TSWT). Alternatively, you can choose to make a direct payment yourself to Inland Revenue at your own marginal tax rate which could be higher or lower than the TSWT.  

New Zealand superannuation schemes will be required to report to the Inland Revenue all foreign superannuation transfers from 1 April 2026. From this date on, you must inform us of the Assessable Withdrawal Amount (AWA) – this figure represents the portion of the transferred funds that is subject to tax – and other information relevant to that report, regardless of whether you are choosing to use Scheme Pays or not.  

If you are thinking about using Scheme Pays 

Scheme Pays is only available for transfers received on or after 1 April 2026. If you wish to use Scheme Pays to meet your Inland Revenue tax liability, you may wish to consider completing the transfer after this date. However, delaying your transfer could impact on the AWA. You should consult a specialist tax adviser regarding the calculation of your AWA and any impact due to timing. 

If you do not use Scheme Pays 

You are responsible for directly paying any tax liability owed to Inland Revenue resulting from the foreign superannuation transfer, at your own marginal tax rate. Funds from your foreign superannuation transfer cannot be used/withdrawn for this purpose if you are under the age of entitlement, so you should ensure that you have sufficient personal funds set aside to cover this obligation. 

An election to use (or not to use) Scheme Pays cannot generally be revoked. Before making any decision, we strongly recommend that you seek specialist tax advice to understand your options and determine what is appropriate for your circumstances. 

Please feel free to talk to one of our Craigs Investment Advisers about this upcoming change, the overall transfer process and documentation we require.  

Useful links to information on IRD website 

Tax residency for individuals >

Taxation of transfers from overseas pension schemes >

Foreign superannuation >

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