US pension to UK

SavingHard

I am new here, I hope I am posting in the right forum.


My husband and I lived in The States for 30yrs. and we came back to England when he retired 2 years ago. My question is about the American pension being transferred to the UK. Has anyone any information about this please? What is the best way to do it? I have contacted the big four, two charge 7 pounds a transaction, one charges 6 pounds and one charges 4 pounds. There will probably be a charge from the bank in America too along with taxes we will have to pay. I would be grateful to hear from anyone with experience in this field. Thank you very much.

EdSwippet

For the best foreign exchange rates, look at one of the specialist forex companies. Moneycorp, XE, HiFx, somebody like that. Remember that the more you exchange, the better the rate that you get.

You might have problems wiring to one of these from a US pension provider and/or the SSA, in which case you can set yourselves up with a UK bank account denominated in USD, wire USD from the US to that, then separately (and at your convenience) convert the USD into GBP by wiring the money from that UK account to the forex dealer, who will then put the GBP into your normal bank account.

All that may sound a bit complicated, but in my experience it's the most frictionless way to receive cash from the US. You pay hugely for forex with the major UK and US banks.

As for taxes, what happens here depends on whether or not you are US citizens.

If you are US citizens, then your lives will be horribly complicated by a bunch of rules that now effectively prevent US citizens opening certain accounts and financial instruments in the UK. All that on top of any US tax you might face on your pension payments. File a W-9 with your pension payers.

If you are not US citizens, things will be simpler. In that case, under the treaty US pensions are taxable only to the UK. File a W-8BEN with your pension payers. If you held US green cards, be sure you have surrendered them formally and correctly, otherwise a bunch of bad things will ensue.

bostonerimus

I assume that by "transfer" you mean just moving income generated by the pension from the US to the UK.....it's not possible to move a US pension account to the UK.

What is the citizenship of the owner of the pension. What type of pension is it......401k, defined benefit, IRA etc and is it government or private funded?

atush

Did you leave your US bank account open?

The easiest way is to have the pensions deposited there, and transfer later (sometimes using an internal transfer if you use a bank like HSBC that has accounts in both countries).

SavingHard

I am sure there is a better way to thank everybody, but I can't find it.


Just wanted to say I appreciate the time you took to answer my question and the useful advice given. This is a government Social Security payment, we still have our account in America so it is to be paid in there, it is just a matter of getting it from A to B the most economical way. Thanks again.

bostonerimus

There is no US tax on US SS when paid to a UK resident (Article 17.3 of the US/UK tax treaty). The best way to get your SS to the UK is to give SSA your UK bank details and have it automatically deposited.

https://www.ssa.gov/pubs/EN-05-10137.pdf

The US SS will be fully taxable in the UK.

If you have other US funds their taxation will depend on the owners citizenship and residency....you haven't told use about those.