Pension lump sump drawdown taxed in UK even though French tax resident

djburns

Hello all, my wife and I have been tax resident in France for the last 7 years and pay tax here on all our world wide income. My wife has had a Standard life pension from our time in the UK and she has drawn down the most of it as a single lump sum. There have been no other withdrawals since a 25% draw down 10 years ago. How ever she has only received approximately 60% as the rest has gone to HMRC. How to we reclaim that back? It will be taxed much more favourably here. Standard Life are useless ,not only was the performance of the pension poor, they only communicate by email days apart....

Albermarle

The 40% tax is probably because she withdrew a large amount at once. For example if you withdraw £50K in one month then HMRC assume you will withdraw that every month in the rest of the tax year and tax you accordingly This is an issue for anyone taking lump sums for the first time out of a pension. In the UK it is easy to get this refunded by filling in a form, but I have no idea about what will happen with a person resident in France. Did you look into this at all before withdrawing the lump sum, as generally all these types of issues tend to be complicated?

xylophone

https://www.gov.uk/tax-uk-income-live-abroad/taxed-twice

may be relevant.

JoeCrystal

https://www.gov.uk/government/publications/double-taxation-united-kingdomfrance-si-2009-number-226-form-france-individual

Bostonerimus1

Read the pensions section of the UK/France double tax treaty and apply for the appropriate tax relief or refund using this form or the specific French one given above. Make sure you pay the appropriate amount of tax to the French tax authority.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1119722/Double_Taxation_Treaty_Relief_Form_DT-Individual.pdf