Contributions and leaving UK

lancs9

In 2009/10 I will leave UK and will not be tax resident here in that year ,nor future one's if everything works out. Can anyone tell me ,or post a link that tells me how that affects my ability to make any further contributions to my Sipps UK scheme. I guess my provider could answer this ,but I think the answer wuill be quicker on here.
thanks very much.

EdInvestor

As you won't have any onshore earnings, you will get no tax relief, so there is no point.

But you should look into the question of continuing voluntary contributions to your state pension, where only 30 years conts are now needed for the full pension and there is no minimum requirement. Class 2 conts for employed expats are a real bargain.

lancs9

Thanks Ed.
I already qualify for the 30 year ..unfortunately LOL

I will still have UK income from bonds/dividends/rent and stuff at least for a while and that will be taxed ,but does that count as income for tax relief purposes?

I also wonder that given gains and income rolling in my Sipp are tax free if that alone is not worth having even if contributions get no tax relief so could I continue to contribute even if no tax relief was allowable ?

EdInvestor

lancs9 wrote: »

I will still have UK income from bonds/dividends/rent and stuff at least for a while and that will be taxed ,but does that count as income for tax relief purposes?

No, it has to be earned income to get tax relief.

I also wonder that given gains and income rolling in my Sipp are tax free if that alone is not worth having even if contributions get no tax relief so could I continue to contribute even if no tax relief was allowable ?

IIRC you can still contribute to a pension for up to 5 years after leaving. But you can invest directly without incurring taxes as an expat so why lock money in a SIPP where a)you can't get it out and b) when you do take the income eventually, it will be taxed - even though you got no tax releief going in?

Don't forget that after 5 years all capital gains will be tax free and up to then you have an annual allowance of over 9k, you still get that as an expat. Divis will be tax free also. There's no advantage at all in using a SIPP..

Debt_Free_Chick

With no earned income, you can still make the basic contribution - currently £3,600 - net of basic rate tax. HMRC will add the tax, so that the maximum contribution you can pay is £3,600 pa. You can of course pay what you want, but you will only get BR tax relief as above.

However, you will only be able to do this for the five tax years following the one in which you cease to be resident - unless you have relevant (taxable) UK earnings.

HMRC guidance here

Cook_County

You may find that the other country taxes you on growth in the pension fund, UK savings & investments etc. Which country are you moving to?