Is an overseas pension included in my UK tax calculations ?

wooder

A friend of mine who is aproaching retirement is in receipt of a small (£1032 pa) pension from a company pension scheme which is paid into her UK bank account and was earned whilst living abroad and working for a company in Canada from 1982-92. Should this be included in her UK tax calculations. She is a UK resident for all her life, except for those 10 years, and also holds a Canadian passport as well as her UK one.

She is over 55 now and has worked full time in the UK since returning from Canada but is reducing her working hours. This will bring her income below the £12500 tax threshold so is intending to top up her income to the maximum tax free allowance by drawing down from a personal pension she holds, but will the Canadian pension have to be taken into account ?

xylophone

Has she obtained a State Pension Forecast?
https://www.gov.uk/check-state-pension

https://www.litrg.org.uk/tax-guides/migrants/what-uk-tax-do-i-pay-my-overseas-pension

wooder

xylophone said:

Has she obtained a State Pension Forecast?
https://www.gov.uk/check-state-pension

Not sure, why, does it have a bearing on the current calculation ?

Rodders53

Of course the Income from an overseas pension it taxable in the UK if the person is domiciled in the UK.
https://www.gov.uk/hmrc-internal-manuals/double-taxation-relief/dt4610#:~:text=Article%2017%20of%20the%20agreement,which%20the%20pensioner%20is%20resident.&text=Annuities%20may%20also%20be%20taxed,in%20which%20the%20pensioner%20resides.

xylophone

Not sure, why, does it have a bearing on the current calculation ?

It is useful to know for planning purposes.
You mention that she is going part time.
Will she still be making NI  contributions (or be being  credited with them)?
The pension forecast will show whether or not she already has sufficient years to qualify for full new state pension.

Marcon

wooder said:

xylophone said:

Has she obtained a State Pension Forecast?
https://www.gov.uk/check-state-pension

Not sure, why, does it have a bearing on the current calculation ?

No.

Yes, it needs to be included in her UK tax calculation.