How to best protect my pension and lump sum from tax

mikeday159

I am on the brink of accepting an offer of voluntary redundancy from a UK Government job. I have looked at the options and the one which I believe I should take will provide me with a tax free lump sum of just over £50k and an immediate pension of around £18k. I will be 52 when the payments start and the pension will not rise until I am 55 at which point it will increase by the CPI. I am currently classified as non resident in the UK for tax purposes as I like and work (with no tax liability due to the nature of my current job) in Europe. I don't need the lump sum or the pension yet so my question is how could I best invest the lump sum and how can I also do the same with with the £18k a year to avoid UK tax (I assume that it will be taxed as it is UK sourced income even though I am non-resident for tax purposes). Any help and advice would be appreciated as this is all very new to me.

atush

It will mainly have to do with where you reside and their treatment of foreign (ie UK) earned income. I assume you don't HAVE to take the pension but could defer it?

Does your country of residence have savings incentives such as ISAs that are tax efficient? Where will you live in retirement, and in whcih country will you look for future work?