Presumably your client will be entitled to her personal allowances & a tax code will be issued to the pension provider once it commences, if less than her pa's no tax will be deducted. You state that your client intends to visit the UK for less than 91 days on average a year. The value of your pension can go down as well as up and you may get back less than you started with. To prevent you being taxed twice on your pension withdrawals, the UK has signed double taxation treaties with over 100 countries. Anybody who has a defined contribution pension scheme will be permitted to access their pension pots as cash from the age of 55. Check with your provider. Some countries, however, do not recognise pension lump sums and you may have to pay income tax in your country of residence on the lump sum from your UK pension. Even though this is paid tax free from the UK, it does not always mean that it will not be taxed in your country of residence. The tax free Pension lump sum UK pension rules allow 25% of your pension to be paid tax free as a single lump sum.

She will start to draw her NHS pension when she is in Qatar and has asked whether this is taxable in the UK. Speak to us about transferring your pension. Once HMRC have approved this, they will inform your UK pension provider that they should not deduct any UK tax from your withdrawals. The other 75% of the pension is treated as income, regardless of whether you draw this as a lump sum or as a regular income. This is known as the 'pension commencement lump sum' or often just referred to as 'tax free cash'. She will start to draw her NHS pension when she is in Qatar and has asked whether this is taxable in the UK.

There is more information on this in point 4 below. However she is being told by colleagues also about to do the same that their NHS pension would be paid to them gross and would not be subject to UK tax when they live and work in Qatar.

You will need to inform HMRC that you are no longer a UK resident, that your new country of residence has a tax treaty with the UK, and that your income will be taxed in your country of residence.

According to HMRC’s website even if she is not UK resident, UK pensions, rental income, interest and earnings are subject to UK tax. This is known as the 'pension commencement lump sum' or often just referred to as 'tax free cash'.
If you’re not a UK resident, you don’t usually pay UK tax on your pension.

If you are not able, or do not draw your pension, at age 55 you can claim your pension from your normal pension date.

If you have a pension in the UK and are now living overseas as a non-UK resident, when you start to withdraw your pension, you will need to be aware of the rules and tax implications not only in the UK, but also in your country of residence. Is this advice correct or just opinion ‘from a bloke down the pub’? Explore our AccountingWEB Live Shows and Episodes, View our 2020 Accounting Excellence Firm Awards Finalists, Report: Working with clients in the new normal, Formulas to avoid sluggish payroll during COVID-19, Avoiding pitiful payroll processing during Covid, Small Business Software: Practitioners’ Choice, Practice Suite of the Year shortlist announced. As with all pensions, your capital is at risk. The information contained on this website is provided as guidance only and should not be construed as advice or a personal recommendation. Why MyExpatSIPP is the ideal UK Pension solution for non-UK residents, 3 sensible reasons to transfer your pension to a SIPP.
Have a look to see who you apply to first.

She will maintain a house in the UK.

MyExpatSIPP is authorised and regulated by the Financial Conduct Authority in the UK, reference number 805568. As mentioned earlier, some will allow pension lump sums to be tax free and some will treat all pension withdrawals as income and tax them accordingly. The amount you pay depends on your income. If you’re unsure of how much State Pension you’re entitled to, you can obtain a State Pension forecast. Foreign nationals must apply for one on entering the UK. But you might have to pay tax in the country you live in. When you draw your UK pension from overseas, and the double taxation treaty states you should only be taxed in your country of residence, this doesn’t automatically mean that your UK pension will be paid tax free. My view is that her NHS pension and any other UK earnings would be subject to UK tax by Self Assessment and her earning in Qatar would be subject to local tax. I note that you were worried that your client had received advice from a bloke down the pub, so you came here and asked a random bunch of halfwits. The value of your pension can go down as well as up and you may get back less than you started with. You can also choose to withdraw this as multiple lump sums, as long as they don’t exceed 25% of your pension value. What is the relevance of that?

The fact that it is an NHS pension is particularly pertinent. income arising in the UK is taxable in the UK. All rights reserved.

Most countries will allow you to take part or all of your pension as a lump sum and will have their own tax rules and allowances. Articles 17 and 18(2) of the treaty refer.

So we know you can get up to 25% of your UK pension paid as a tax free lump sum. Alternatively, you can ask your provider to pay your pension into a UK bank account.

If so you can apply for pension to be gross on the basis that it will be declared in Qatar. Unless a pension provider has the necessary Financial Conduct Authority (FCA) authorisation to accept new pension business from people living abroad, it’s generally not possible for personal or employer contributions to re-start or be increased to an existing personal pension or stakeholder arrangement after a member has moved overseas.

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