Tax on pension if resident abroad
Discussion
If they are completely non UK resident, then they should not be subject to UK tax on the pension. They should be subject to whatever tax they would need to pay in the country of which they are now the tax redident.
Obviously, they would need to demonstrate that they are indeed no longer resident in the UK for UK tax purposes.
Non-residents sometimes need to complete UK Self Assessment tax returns in order to ensure that they don't pay too much UK tax.
Obviously, they would need to demonstrate that they are indeed no longer resident in the UK for UK tax purposes.
Non-residents sometimes need to complete UK Self Assessment tax returns in order to ensure that they don't pay too much UK tax.
As a default all UK occupational and personal pensions are taxed at source under PAYE. In order for it to be paid gross you need to be resident in a country with a double tax agreement with the UK and then jump through the hoops at HMRC to notify them that you are regiatered for tax in the country you are residing.
There are many circumstances where 20% tax is taken at source on UK income from individuals who are now resident outside the UK. The assumption is that the person will notify the tax authorities in the country where he now lives and pay any tax due to those aithoroties. If the UK has a double taxation agreement (DTA)with that country, then the 20% already paid to the UK tax man will be allowed as a credit against any tax due to the foreign tax authority.
The UK has DTAs with most countries but there are still a few countries where we don't - so you would need to know the score depending on what country you were planning on going to live.
The UK has DTAs with most countries but there are still a few countries where we don't - so you would need to know the score depending on what country you were planning on going to live.
A question the for the Eric Mc and Purplemoonlight - as I'm coming up to this stage in life.
Q1. If I convert my private UK pensions into income, I take it these will be taxed at 20%....in the UK regardless of the amount? If I told NZ authorities it would not be taxed further (unless I pay a higher rate here).
Q2. MIL. She is not entitled to any NZ benefits at all (we have made sure she doesn't have an NZ tax number either). She has a UK state pension - and a Navy pension. Are both these taxed at 20% in the UK? If so, could she (perhaps in theory) fill in UK tax forms to claim anything back? She has permanent residency in NZ. (and yes - she is one of those with a frozen state pension from the UK fixed at when she first came here seven years ago, it never goes up)
Q1. If I convert my private UK pensions into income, I take it these will be taxed at 20%....in the UK regardless of the amount? If I told NZ authorities it would not be taxed further (unless I pay a higher rate here).
Q2. MIL. She is not entitled to any NZ benefits at all (we have made sure she doesn't have an NZ tax number either). She has a UK state pension - and a Navy pension. Are both these taxed at 20% in the UK? If so, could she (perhaps in theory) fill in UK tax forms to claim anything back? She has permanent residency in NZ. (and yes - she is one of those with a frozen state pension from the UK fixed at when she first came here seven years ago, it never goes up)
OK. Say I was to have a private pension of 5,000 a year from a fund in the UK. Does the annuity provider deduct any tax?
Does it make any difference if the annuity is sent to a UK bank account?
And what happens (theoretically in my case), if I had say four such individual pensions?
Is any UK tax deducted?
At some point I have to decide if I bring the pension fund itself to NZ - the advantage being I can have access to it as a lump sum if I wish.
Does it make any difference if the annuity is sent to a UK bank account?
And what happens (theoretically in my case), if I had say four such individual pensions?
Is any UK tax deducted?
At some point I have to decide if I bring the pension fund itself to NZ - the advantage being I can have access to it as a lump sum if I wish.
Is purplemoonlight referring to the State Pension?
There are plenty of UK tax residents who have their WORK RELATED pensions taxed at Basic Rate (i.e. 20%).
Lots of useful stuff here -
://www.hmrc.gov.uk/cnr/allow_nonres.htm]
There are plenty of UK tax residents who have their WORK RELATED pensions taxed at Basic Rate (i.e. 20%).
Lots of useful stuff here -
://www.hmrc.gov.uk/cnr/allow_nonres.htm]
Edited by Eric Mc on Sunday 12th February 08:35
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