Go Back   British Expats / Living & Moving Abroad / Canada

Reply
 
Thread Tools
Old Jul 16th 2017, 6:08 pm   #61
Binned by Muderators
 
Joined: Jul 2007
Location: White Rock BC
Posts: 11,633
JonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

The CRA official has made a mistake in tax law. 56(1)(a)(i)(C.1) does not say that a pension that is exempt from tax in the country of origin is exempt from tax in Canada. It says that a retirement compensation arrangement that is exempt from tax in the country of origin is exempt in Canada.

Why the nit picking? It is because a retirement compensation arrangement is not the same thing as a pension. Retirement compensation arrangements are defined and specified elsewhere in the Act and Regulations. The only retirement compensation arrangement currently identified as being qualified for this concession is a United States Individual Retirement Account.

Not that it matters to you. Fill your boots.
__________________
Any reference to tax above is for general interest only and is not intended as professional advice.
JonboyE is offline   Reply With Quote
Old Jul 17th 2017, 3:53 am   #62
BE Enthusiast
 
Joined: Jul 2008
Location: Toronto
Posts: 515
dgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by JonboyE View Post
This is an extract from Income Tax ruling 911675. It is quite old – from 1999 – but I cannot find a more recent update.

To summarize, a single amount paid out of a United Kingdom pension plan will be taxable as "pension" in Canada unless it is in settlement of all future benefits under the plan. Accordingly, where a person has elected to receive an initial lump sum payment but not one that was in settlement of all future benefits, the amount will be "pension" pursuant to section 3 of Article 17 of the Convention and may be taxed by Canada pursuant to section 56 of the Act. In this respect, it is irrelevant that the amount may be received tax free by a recipient who is resident in the United Kingdom.
Interesting...does that mean that, if you can take the entire UK pension as a lump sum, then it's not taxable in Canada (although it may be in the UK of course)?
dgagitw is offline   Reply With Quote
Old Jul 17th 2017, 1:34 pm   #63
BE Forum Addict
 
Joined: Feb 2005
Posts: 1,501
lins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by JonboyE View Post
The CRA official has made a mistake in tax law. 56(1)(a)(i)(C.1) does not say that a pension that is exempt from tax in the country of origin is exempt from tax in Canada. It says that a retirement compensation arrangement that is exempt from tax in the country of origin is exempt in Canada.

Why the nit picking? It is because a retirement compensation arrangement is not the same thing as a pension. Retirement compensation arrangements are defined and specified elsewhere in the Act and Regulations. The only retirement compensation arrangement currently identified as being qualified for this concession is a United States Individual Retirement Account.

Not that it matters to you. Fill your boots.
Just to be clear. I have spoken at length to My CRA manager and this has been processed through their legal department, so in their eyes is correct. As with all legislation, one can read into it all sorts of connotations and it is broadly open to the readers interpretation. The only interpretation which matters to CRA is theirs.
Fill my boots, is kind of rude, was it meant that way? I am only trying to help others and at not financial gain to myself. That is what I believe this forum is about.
Stef
lins and Stef McLachlan is offline   Reply With Quote
Old Jul 17th 2017, 3:26 pm   #64
Binned by Muderators
 
Joined: Jul 2007
Location: White Rock BC
Posts: 11,633
JonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by dgagitw View Post
Interesting...does that mean that, if you can take the entire UK pension as a lump sum, then it's not taxable in Canada (although it may be in the UK of course)?
It is taxable, just not as a pension.
__________________
Any reference to tax above is for general interest only and is not intended as professional advice.
JonboyE is offline   Reply With Quote
Old Jul 17th 2017, 3:31 pm   #65
Binned by Muderators
 
Joined: Jul 2007
Location: White Rock BC
Posts: 11,633
JonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond reputeJonboyE has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by lins and Stef McLachlan View Post
Just to be clear. I have spoken at length to My CRA manager and this has been processed through their legal department, so in their eyes is correct. As with all legislation, one can read into it all sorts of connotations and it is broadly open to the readers interpretation. The only interpretation which matters to CRA is theirs.
Fill my boots, is kind of rude, was it meant that way? I am only trying to help others and at not financial gain to myself. That is what I believe this forum is about.
Stef
It wasn't intended to be rude. You got a ruling in your favour so it is something to celebrate.

I said up thread that sometimes the CRA choose administrative positions that are not in strict accordance with the law. This appears to be a new one. You are helping others as many will now appeal the initial assessment of their 25%. It will be interesting to see if other tax centres agree.
__________________
Any reference to tax above is for general interest only and is not intended as professional advice.
JonboyE is offline   Reply With Quote
Old Jul 17th 2017, 6:28 pm   #66
BE Forum Addict
 
Joined: Feb 2005
Posts: 1,501
lins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by JonboyE View Post
It wasn't intended to be rude. You got a ruling in your favour so it is something to celebrate.

I said up thread that sometimes the CRA choose administrative positions that are not in strict accordance with the law. This appears to be a new one. You are helping others as many will now appeal the initial assessment of their 25%. It will be interesting to see if other tax centres agree.
Okay
But with it now in Black and white, they have set the precedence, which would be arguable in a court of law.....I am so hoping others now get their money back......that would be something eh?
Stef
lins and Stef McLachlan is offline   Reply With Quote
Old Jul 17th 2017, 6:55 pm   #67
Manui Dat Cognitio Vires
 
Almost Canadian's Avatar
 
Joined: Aug 2005
Location: South of Calgary
Posts: 12,137
Almost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by lins and Stef McLachlan View Post
Okay
But with it now in Black and white, they have set the precedence, which would be arguable in a court of law.....I am so hoping others now get their money back......that would be something eh?
Stef
Not quite An official, it would appear somewhat incorrectly, has applied the law in a way that has resulted in a windfall to you. Only Courts can interpret the law and set precedents that bind Courts below them. This doesn't appear to have happened yet and you need to pray that it doesn't as your result appears to have gone against actual Court decisions.
__________________
Don't argue with an idiot - they will drag you down to their level and will beat you with experience!
Almost Canadian is offline   Reply With Quote
Old Jul 18th 2017, 5:13 pm   #68
BE Enthusiast
 
Joined: Jul 2008
Location: Toronto
Posts: 515
dgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond reputedgagitw has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by JonboyE View Post
It is taxable, just not as a pension.
I thought that sounded too good to be true.
dgagitw is offline   Reply With Quote
Old Jul 24th 2017, 7:11 pm   #69
Just Joined
 
Joined: Jul 2017
Posts: 2
Dailogs is an unknown quantity at this point
Default Re: READ ME. PENSION RULES UK to Canada

I live in Canada (ex UK) and have a Prudential investment bond which is a single premium life assurance policy. Under this I can receive a regular payment free of UK tax up to a limit of 5% of the amount invested. This I take every month, paid into my UK bank account.
I did not take a lump sum payment, only the monthly withdrawal.

Will this amount be taxed in Canada ?
Dailogs is offline   Reply With Quote
Old Jul 25th 2017, 9:18 am   #70
BE Forum Addict
 
Hurlabrick's Avatar
 
Joined: Apr 2013
Location: Ottawa
Posts: 1,094
Hurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond reputeHurlabrick has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by Dailogs View Post
I live in Canada (ex UK) and have a Prudential investment bond which is a single premium life assurance policy. Under this I can receive a regular payment free of UK tax up to a limit of 5% of the amount invested. This I take every month, paid into my UK bank account.
I did not take a lump sum payment, only the monthly withdrawal.

Will this amount be taxed in Canada ?
I know this type of product. It is NOT a 5% annual 'tax free' withdrawal, it is 'tax deferred' for a maximum of 20 years. You would pay tax in the UK, albeit after 20 years. The idea being that you may be in a lower tax band in 20 years (e.g. retired). To answer your question though, you have to declare these withdrawals on you Canadian tax return - I suspect you will be liable to Canadian tax (but not certain). I am sure others will chime in on the Canadian tax front.
Hurlabrick is offline   Reply With Quote
Old Aug 3rd 2017, 10:23 pm   #71
Adyted 
Just Joined
 
Joined: Aug 2017
Posts: 4
Adyted is an unknown quantity at this point
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by lins and Stef McLachlan View Post
It is official. We got a registered letter containing a reassessment dated May 23, 2017. I can send you a couple of pictures of the parts of the letter which are relevant to this, but will need your email as I dont know how to attach docs to this. I also do not want to post this online as it is personal information. You are going to need a letter from your pension provider clearly stating that you did not receive more than 25% as your Tax free lump sum
PM Me your email.....,that goes for anyone else who needs this......Jonboy, this includes you.

I also spoke to HMRC in UK and they said that because it was below the 25% that they were not told of it as there was no tax owing to them, so they had no interest in it and there was nothing they could add of relevance as we never paid any tax in the UK on this amount.
Stef
Stef McLachlan I can't PM you, don't let me. I am new to this, but I will really like more information.
Adyted is offline   Reply With Quote
Old Aug 3rd 2017, 11:36 pm   #72
Manui Dat Cognitio Vires
 
Almost Canadian's Avatar
 
Joined: Aug 2005
Location: South of Calgary
Posts: 12,137
Almost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond reputeAlmost Canadian has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by Adyted View Post
Stef McLachlan I can't PM you, don't let me. I am new to this, but I will really like more information.
Make one more post and you will be able to send PMs
__________________
Don't argue with an idiot - they will drag you down to their level and will beat you with experience!
Almost Canadian is offline   Reply With Quote
Old Aug 4th 2017, 1:49 am   #73
Adyted 
Just Joined
 
Joined: Aug 2017
Posts: 4
Adyted is an unknown quantity at this point
Default Re: READ ME. PENSION RULES UK to Canada

Thank you Almost Canadian, I am getting this slowly
Adyted is offline   Reply With Quote
Old Aug 4th 2017, 2:26 pm   #74
Adyted 
Just Joined
 
Joined: Aug 2017
Posts: 4
Adyted is an unknown quantity at this point
Default Re: READ ME. PENSION RULES UK to Canada

Let us know what they reply
Quote:
Originally Posted by getoutofbritainquick View Post
I paid a substantial sum to the CRA for my pension lump sum. I will obviously write to them to see what their reply is. If anyone has a formal letter from the CRA with confirmation that this is the case that would be great. I know Johnboy has been a greet source for tax information on this site and this would have massive implications for many of us who has received our pension lunp sums while we were resident in Canada.
Adyted is offline   Reply With Quote
Old Aug 4th 2017, 7:18 pm   #75
BE Forum Addict
 
Joined: Feb 2005
Posts: 1,501
lins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond reputelins and Stef McLachlan has a reputation beyond repute
Default Re: READ ME. PENSION RULES UK to Canada

Quote:
Originally Posted by Adyted View Post
Stef McLachlan I can't PM you, don't let me. I am new to this, but I will really like more information.
Send me a PM with your email address and I will send the info
Stef
lins and Stef McLachlan is offline   Reply With Quote
Reply

Go Back   British Expats / Living & Moving Abroad / Canada


Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off



All times are GMT. The time now is 6:47 pm.


We are a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for us to earn fees by linking to Amazon.com and affiliated sites.
Powered by vBulletin: ©2000 - 2018, Jelsoft Enterprises Ltd.
© 1999-2010 BritishExpats.com