Self-assessment form - overseas pension

dunroving

Currently struggling with the above. I've run a search and read all potentially relevant threads all the way back to January 2013, but can't find the answer (did find out some other interesting things, though!)

I'm a UK citizen and resident, and need to complete a self-assessment because I received payments from my US pension during the 2016-2017 tax year. It's a " not registered in the UK" scheme (TIAA-CREF). I have all the relevant figures, and when I fill in the paper self-assessment form, don't encounter any issues when I fill in sections A to F (but I need to submit electronically, as I am now past the paper assessment deadline).

Below is "chronologically" what I am doing:

Section 3, Tailor your return, Question "If you received any foreign income, do you need to complete the foreign section?", ticked "Yes" (Help says "The Foreign section should be completed if you received income from any of the following overseas sources: <<snip>> overseas pensions, social security benefits and royalties <<snip>>
[Click "Next"]
next page (p. 2) in Section 3, Tailor your Return, Question, "Are you liable to pension savings tax charges or have you received payments from overseas pension schemes?", Ticked "Yes" (Help section is all about pension savings tax charges, but the second part of the question applies to me - and if I tick "No", the pension section of my self-assessment disappears).
[Click "Next"]
next page (p. 3) in Section 3, Tailor your Return has no questions about overseas income.
[Click "Next"]
Section 4, Fill in your Return, Foreign income details (Page 1 of 2) starts with "You have said that you had foreign income in the tax year 2016 to 2017", has blurb about nonremittance basis (which doesn't apply to me), and hen asks, "Were you unable to transfer some or all of your overseas income to the UK?", so I ticked "No" (I transferred it all to the UK)
[Click "Next"]
Section 4, Fill in your Return, Foreign income details (Page 2 of 2), I tick the box that says "Overseas pensions, social security benefits and royalties etc", Help says, "Tick the checkbox if at any time during 6 April 2016 to 5 April 2017 tax year you received a pension or social security benefits from overseas. You should also include any pensions or annuities paid in the UK but on behalf of an overseas pension provider who is outside the UK."
[Click "Next"]
Section 4, Fill in your Return, Overseas pensions, social security benefits and royalties etc., filled in the information on the source (TIAA-CREF), country, amount of income, foreign tax (none) special withholding (none), foreign tax credit relief (No), and taxable amount (same as income amount)
- so far, so good.

[Click "Next"]

Section 4, Fill in your Return, Pension saving tax charges etc
- and here's where I get stuck, because none of the elements in this section applies (it's all about exceeding the lifetime allowance or annual allowance, and about lump sum due to death of the beneficiary), but I can't advance without entering some figure, and can't enter zeroes ...

Any ideas what I am doing wrong? There is a link at the bottom that says, "Delete pension saving tax charges and taxable lump sums from overseas pension schemes section", but when I do his, it deletes all the sections related to overseas pension income, so I can't declare the income I received from my US pension scheme.

On the paper form for overseas income (SA106), the stuff on this last page of the electronic version simply doesn't exist.

Stumped. :mad:

dunroving

Doh, Sod's Law, when you get to the point where you give up and ask for help, you sort out the problem!

I eventually went back and clicked again on the link that said, ""Delete pension saving tax charges and taxable lump sums from overseas pension schemes section", I managed to find the rest of the overseas income/pension section, still intact. I think it was more a case of my unfamiliarity with navigating the online form. It seems odd that if you go back to the first section and keep clicking on "Next", you never see the overseas income section, bit there is a link to it on the "page of contents" on page 4 "Fill in your Return - Check your Progress" page.

I'm interested so see that I owe £3,000 in tax on my overseas pension income (fair enough, as that's about what I calculated, and the rest of my income had been PAYE), but it's asking me to pay £1,500 in addition in January "on account" for 2017-2018. Is that because it is assuming my 2017 will be similar to my 2016 and so it's asking me to pay tax in advance, so to speak? Again, it's fair enough as I will owe about the same, but in subsequent years my pension withdrawals will be nowhere near the same. Presumably, if I know my income will drop in a forthcoming tax year, I can request to pay less, or not pay anything "on account"?

EdSwippet

dunroving wrote: »

... Is that because it is assuming my 2017 will be similar to my 2016 and so it's asking me to pay tax in advance, so to speak? ... Presumably, if I know my income will drop in a forthcoming tax year, I can request to pay less, or not pay anything "on account"?

Yes, and yes. Explained (mostly) here: Understand your Self Assessment tax bill.

It is all a bit painful, but so far at least it remains a long way from the US's miserable quarterly estimated payments followed by annual Form 2210 nonsense. That is really painful. I had to do it one year, and vowed never again.

[Deleted User]

dunroving wrote: »

Doh, Sod's Law, when you get to the point where you give up and ask for help, you sort out the problem!

I eventually went back and clicked again on the link that said, ""Delete pension saving tax charges and taxable lump sums from overseas pension schemes section", I managed to find the rest of the overseas income/pension section, still intact. I think it was more a case of my unfamiliarity with navigating the online form. It seems odd that if you go back to the first section and keep clicking on "Next", you never see the overseas income section, bit there is a link to it on the "page of contents" on page 4 "Fill in your Return - Check your Progress" page.

I'm interested so see that I owe £3,000 in tax on my overseas pension income (fair enough, as that's about what I calculated, and the rest of my income had been PAYE), but it's asking me to pay £1,500 in addition in January "on account" for 2017-2018. Is that because it is assuming my 2017 will be similar to my 2016 and so it's asking me to pay tax in advance, so to speak? Again, it's fair enough as I will owe about the same, but in subsequent years my pension withdrawals will be nowhere near the same. Presumably, if I know my income will drop in a forthcoming tax year, I can request to pay less, or not pay anything "on account"?

Is a claim to 10% FID on your US pension appropriate?

https://www.taxation.co.uk/Articles/2012/02/08/35561/foreign-pension

dunroving

[Deleted User] wrote:

Is a claim to 10% FID on your US pension appropriate?

https://www.taxation.co.uk/Articles/2012/02/08/35561/foreign-pension

If I'm understanding your point correctly, yes it is. Apparently, you just report 90% of the foreign pension on the tax return (at least that's what I got from a couple of the threads I found from my original search, and from the instructions for form SA106). I would have thought the online form would do the calculation automatically when determining the tax that's due, but it doesn't.

dunroving

Interesting side point is that when I called HMRC self-assessment helpline yesterday, the woman couldn't help so tried to put me through to a "technical advisor", but they were all busy. A technical advisor called me back this morning, which I was pretty impressed with.

EdSwippet

dunroving wrote: »

Apparently, you just report 90% of the foreign pension on the tax return ...

That's my understanding also.

Note that effective from April this year the government has scrapped this 10% deduction for foreign pensions. (Although this causes an increase in tax liability, the government apparently does not regard this as an election pledge-breaking 'tax increase'...)

[Deleted User]

dunroving wrote: »

If I'm understanding your point correctly, yes it is. Apparently, you just report 90% of the foreign pension on the tax return (at least that's what I got from a couple of the threads I found from my original search, and from the instructions for form SA106). I would have thought the online form would do the calculation automatically when determining the tax that's due, but it doesn't.

Yes - I do know but was making sure that you did.:)

Not every overseas pension benefits from the same rule but we will not enter the world of double taxation treaties.

dunroving

EdSwippet wrote: »

That's my understanding also.

Note that effective from April this year the government has scrapped this 10% deduction for foreign pensions. (Although this causes an increase in tax liability, the government apparently does not regard this as an election pledge-breaking 'tax increase'...)

I'd thought they were planning to do this but thought it had been shelved as I couldn't find anything. So this will be the case from April 2018 (I assume you meant April of this "tax" year?). [edit: Ah, no, I guess you mean it will affect this year's tax return; forgot that my question was about last year's tax return]

Will have to get the calculator out again in that case, as I was planning on taking further overseas pension withdrawals .... I guess "20% of 10%" means I'll lose an additional 2% of the total amount.... <<brain cogs whirring>>

jennifernil

EdSwippet wrote: »

That's my understanding also.

Note that effective from April this year the government has scrapped this 10% deduction for foreign pensions. (Although this causes an increase in tax liability, the government apparently does not regard this as an election pledge-breaking 'tax increase'...)

My husband has a small state pension from Norway, he recently submitted his paper return and it was still stating that a 10% deduction should be made for TY 16/17.

So this comes in for TY 17/18??

Or does it not apply to state pensions?

He has not been made aware of any upcoming changes.

jimmo

jennifernil wrote: »

My husband has a small state pension from Norway, he recently submitted his paper return and it was still stating that a 10% deduction should be made for TY 16/17.

So this comes in for TY 17/18??

Or does it not apply to state pensions?

He has not been made aware of any upcoming changes.

Did you follow the link in post #7?
If not here is another version.
https://www.gov.uk/government/publications/pension-tax-for-overseas-pensions-additional-information/pension-tax-for-overseas-pensions-additional-information
Looks pretty definite that your husband's pension is caught.