Treasury has released draft legislation to establish a trans-Tasman retirement savings portability scheme.

The Governments of Australia and New Zealand have signed an Arrangement to permit Australians and New Zealanders to transfer their retirement savings when they move between Australia and New Zealand, while preserving the integrity of the retirement savings systems of both countries.

Key features of the portability scheme include:
•individuals may transfer their retirement savings between an Australian complying superannuation fund regulated by the Australian Prudential Regulation Authority and a New Zealand KiwiSaver scheme;
•participation is voluntary for members and for superannuation funds and schemes;
•retirement savings will be transferred with minimal costs;
•retirement savings will generally be subject to the rules in the host country; and
• New Zealand retirement savings transferred to Australia will be treated as non‑concessional contributions and subject to the Australian non-concessional cap arrangements at the initial point of entry.

The legislation is expected to be introduced into Parliament later this year, and is likely to take effect from 1 July 2013.