Estate planning with overseas child

aroominyork

I have a 101 question. What is a trust-based SIPP? OH and I have 'normal' SIPPs.

Also, Article 23 says:

1. Items of income beneficially owned by a resident of a Contracting State, wherever arising, which are not dealt with in the foregoing Articles of this Convention, other than income paid out of trusts or the estates of deceased persons in the course of administration, shall be taxable only in that State.

Does that mean no more than that inherited estates are not taxed by France, in line with https://www.legislation.gov.uk/uksi/1963/1319/pdfs/uksi_19631319_en.pdf but doesn't throw any light on this SIPP issue?

Dead_keen

This stuff is not easy. I have spent a lot of time understanding UK unregistered pensions and unusual US "pension" arrangements and how they work and are taxed in the UK. But I have no absolutely no idea about French law, French domestic tax, or the application of UK/France DTA. As I said before, if the amounts are material I would get proper advice.

Does that [Article 23] mean no more than that inherited estates are not taxed by France

No, that is not what Article 23 means. Article 23 is just about income and who has taxing rights, not inheritances and the tax on them

Whether it matters or not whether a SIPP is contact-based or trust-based is something that is not relevant to the UK tax treatment, and may potentially be relevant to understanding the French tax treatment. But it may be not relevant to that either - I just don't know. Saying that, I am used to trust based pension schemes and assumed that some SIPPs will be trust-based (but have never checked). My SIPP is contract-based and a quick google suggests mosts SIPPs may be contract-based. You can ask your SIPP provider and they shuld be able to tell you. Many, if not all, contract-based SIPPs will use a trustee to hold the assets. As I say, I have no idea if any of that is relevant to French tax.

aroominyork

AI tells me ii's SIPPs are trust-based, but since France does not recognise UK trusts and would probably look through it, it probably makes little difference. In any case, this has been very useful and I'll discuss with our lawyer. Thanks.