The UK and New Zealand signed a new Double Taxation Convention on 1 June 2026, replacing the long-standing agreement between the two countries.
For people living in New Zealand with a UK pension, the obvious question is whether the new treaty changes the tax position or should affect a UK pension transfer to New Zealand.
For most people, the answer is no.
The new treaty contains some changes involving pension schemes, but it does not create a new tax exemption for UK pension transfers, change New Zealand’s foreign superannuation tax rules or replace the UK’s QROPS rules.
What has changed?
The new treaty introduces a specific definition of a “recognised pension fund”.
This includes qualifying New Zealand registered superannuation and KiwiSaver schemes, as well as UK pension schemes registered under Part 4 of the Finance Act 2004.
The main practical effect is at scheme level.
For example, a recognised New Zealand pension fund investing in certain UK interest-bearing investments may be able to receive that interest without UK tax being deducted. Similar treatment can apply in the opposite direction.
This can simplify the tax administration of cross-border investments held by pension schemes.
It does not, however, mean that transferring a UK pension to a New Zealand scheme has become tax-free.
Does this create a tax saving for members?
Not necessarily.
Where overseas tax was previously deducted from investment income, a New Zealand scheme may already have been able to claim a foreign tax credit against New Zealand tax payable on the same income.
In a simplified example, if 10% tax was paid overseas and the total New Zealand tax liability was 28%, the scheme might pay the remaining 18% in New Zealand.
Under the new treaty, there may instead be no overseas tax and the full 28% may be paid in New Zealand.
The total tax could therefore remain the same.
There may still be administrative, cash-flow or other benefits for pension schemes, particularly where foreign tax credits could not previously be fully used, but this does not automatically translate into a better tax outcome for an individual member.
What does not change?
For someone considering a UK pension transfer to New Zealand, the key rules remain unchanged.
The new treaty does not:
- make UK pension transfers to New Zealand automatically tax-free;
- change New Zealand’s four-year foreign superannuation exemption;
- change how New Zealand calculates tax on a taxable foreign pension transfer;
- change the new Scheme Pays rules introduced from 1 April 2026; or
- replace the UK’s QROPS and overseas pension transfer rules.
The general treaty treatment of pension income also remains substantially the same. A qualifying UK pension received by a New Zealand resident is generally taxable in New Zealand rather than the UK.
For more detail on the underlying tax rules, see our UK Pension Transfer to New Zealand Tax Guide.
You can also read more about when a foreign pension transfer to New Zealand is not taxed and the new Scheme Pays tax regime.
Should the new treaty affect your decision to transfer?
In our view, generally no.
The new treaty is an important update to the tax relationship between the UK and New Zealand, but its pension-related changes are mainly relevant to the pension schemes themselves rather than to an individual deciding whether to transfer.
The factors that should continue to drive that decision include:
- when you became New Zealand tax resident;
- whether you are still within the four-year exemption period;
- any New Zealand tax payable on the transfer;
- the benefits and guarantees attached to your existing UK pension;
- QROPS and UK overseas transfer rules;
- investment options and costs; and
- your longer-term plans, including where you expect to live.
The new Double Tax Treaty does not materially change those considerations.
Official sources
This article provides general information only and does not constitute tax, legal or financial advice. Individual circumstances should be considered before making a pension transfer decision.
