The Australia expatriate community is one of the oldest and most well established in the world. From its roots as a British colony to its status as a choice destination for a globalised workforce there is a large a growing expat community in Australia that is hitting back against British government policy.
Ever since the 1950s the british government has raised pension payments inline with inflation to preserve and protect old age pensioners’ buying power. However, for expats in Australia this rule does not apply. So whilst for a pensioner living in Britain their income has doubled in the past 20 years the same person living in Australia will not have their expat pension increased from the time they retire.
It is not only Australia that is affected with over 200 000 expats in Canada, New Zealand and South Africa amongst those also affected. However, other countries such as the United States and Israel get a fully indexed pension that does rise with inflation due to the bilateral taxation agreements that these countries have negotiated with the United Kingdom.
For advice on building up a sufficient pension to allow for a reasonable income on retirement it is important to consult a quality Independent Financial Advisor (IFA).