The Special Banking Option

The Special Banking Option (SBO) is currently available to those who receive benefits or pensions from:

• United Kingdom
• The Netherlands
• Australia
• Jersey
• Guernsey
• Republic of Ireland

It is suitable for people who would otherwise receive an overseas benefit or pension and part payment of New Zealand Superannuation or benefit.

The advantage of the SBO over direct payment

• SBO ensures your combined benefit or pension payments from overseas and from New Zealand is paid at the same rate as the full rate of New Zealand Superannuation or benefit.

It is not suitable for people who:

• are going overseas for more than 26 weeks, or
• are receiving an overseas pension that exceeds the New Zealand benefit or pension or is likely to exceed if the exchange rate changes, or
• are un-discharged bankrupts, or
• have been granted a New Zealand Superannuation or benefit using the Australian social security agreement, lived in New Zealand for less than 10 years, receive an Australian pension and a pension from a third country, or have residence in a third country that may entitle them to a third country pension
• have a voluntary or non-deductible component to their overseas pension (excluding Netherlands holiday pay), or
• have an outstanding overseas pension debt with the overseas agency, or
• have previously chosen to transfer back to receiving their overseas pension directly while still residing in New Zealand, or
• have previously had their Special Banking Option account closed because they breached the Special Banking Option rules.

You can generally only opt for the Special Banking Option once for each country. In most circumstances, if you chose to close your Special Banking Option account and receive your overseas benefit or pension directly, you cannot rejoin the Special Banking Option.

If your spouse or partner also receives an overseas pension or benefit:

• You must both use the same payment option, either by direct payment or SBO.

• The SBO option allows your overseas benefit or pension to be paid directly into a special Westpac bank account here in New Zealand.
• This account is held in your name but only accessible by the Ministry of Social Development. The account does not incur bank fees nor earn any interest.
• You will receive regular payment equal to the full rate of New Zealand Superannuation or benefit, regardless of how much your overseas pension is.

• Fluctuations in the exchange rate will not affect your payments as they would if you were receiving the overseas payment directly.

Tax

• Once your overseas pension is paid into the SBO, you don’t need to pay New Zealand tax separately on your overseas pension.
• You will need to pay tax on any other payments that you receive directly.
• For any other tax questions please contact Inland Revenue on 0800 227 774 (please have your IRD number handy) or visit:

To apply for the Special Banking Option you'll need to complete an application pack.

If you can't print the forms out, you can call International Services on 0800 777 227 to get an application form sent to you.

Once you've completed the forms, you'll need to drop them off to one of our service centres, or you can post them to:

International Services
Ministry of Social Development
PO Box 27178
Wellington 6141