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Old Sep 24th 2017, 1:16 am   #1
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Default HMRC Marriage Allowance

I have been reading lately of unclaimed 'marriage allowance' for UK tax payers. It appears that if you are a basic UK tax payer and your married partner does not work then you can transfer some of your partners unclaimed tax allowance to the basic tax payers allowance and thus save paying some tax, always a good thing.
I receive a monthly annuity payment, on which I pay basic UK tax to HMRC, my Filipino wife does not work. We live in the Philippines although I'm still on a visitors visa, soon to be changed to residents visa.
Does anyone have experience of claiming this allowance?
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Old Sep 24th 2017, 1:43 am   #2
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Default Re: HMRC Marriage Allowance

What sort of annuity are you receiving? Generally speaking you pay tax where you live, so it is likely that you shouldn't be paying any tax in the UK if you live in the Philippines, unless your annuity is one of the few income streams that are taxed at source even if you live overseas.
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Old Sep 24th 2017, 1:45 am   #3
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Default Re: HMRC Marriage Allowance

Unfortunately my annuity is taxed at source and has to be deposited in a UK bank account despite me living in the Philippines.
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Old Sep 24th 2017, 2:05 am   #4
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Default Re: HMRC Marriage Allowance

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Originally Posted by kompani101 View Post
Unfortunately my annuity is taxed at source and has to be deposited in a UK bank account despite me living in the Philippines.
Lots of things are "taxed at source" in the UK, but only until you tell them that you have left the UK, them you are paid gross. .... An exception is a pension paid for service to the government, such as a civil service, or military pension.

In other words are you certain that your annuity is an exception to the rule that income is taxed where the recipient lives?
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Old Sep 24th 2017, 3:50 am   #5
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Default Re: HMRC Marriage Allowance

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Originally Posted by Pulaski View Post
Lots of things are "taxed at source" in the UK, but only until you tell them that you have left the UK, them you are paid gross. .... An exception is a pension paid for service to the government, such as a civil service, or military pension.

In other words are you certain that your annuity is an exception to the rule that income is taxed where the recipient lives?
Absolutely correct as usual Pulaski! I have two annuities, paid into my UK account, both tax free. you need to fill in the DTT(Individual) form from HMRC website, get it certified by the BIR here in Philippines( HMRC want to know you are registered for tax in the country you live in, even if, as here, any funds remitted from outside the country are tax free) and send it back to HMRC Cardiff. As my State pensions are over the tax free allowance, I have to pay UK tax on them and I do this via my annual self-assessment return. Re the marriage allowance. This only applies if your wife has a UK NI and Unique Tax payer reference and is not working or earning less than the tax free allowance in the UK. You can always try and claim it but don't hold your breath.Once you have your residents visa, apply for a TIN from BIR then fill in the DTT form and away you go.You cannot claim tax relief under the DTT if not tax resident where you live
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Old Sep 24th 2017, 6:01 am   #6
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Default Re: HMRC Marriage Allowance

I shall investigate further but on both times I have asked previously I was told it is only payable in the UK and must be taxed at source. It is a private annuity not linked to government. Thanks.
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Old Sep 24th 2017, 6:05 am   #7
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Default Re: HMRC Marriage Allowance

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Absolutely correct as usual Pulaski! I have two annuities, paid into my UK account, both tax free. you need to fill in the DTT(Individual) form from HMRC website, get it certified by the BIR here in Philippines( HMRC want to know you are registered for tax in the country you live in, even if, as here, any funds remitted from outside the country are tax free) and send it back to HMRC Cardiff. As my State pensions are over the tax free allowance, I have to pay UK tax on them and I do this via my annual self-assessment return. Re the marriage allowance. This only applies if your wife has a UK NI and Unique Tax payer reference and is not working or earning less than the tax free allowance in the UK. You can always try and claim it but don't hold your breath.Once you have your residents visa, apply for a TIN from BIR then fill in the DTT form and away you go.You cannot claim tax relief under the DTT if not tax resident where you live
I shall investigate this much further as my two previous sources, one being the annuity company and the other the independent financial adviser, stated it had to be paid in the UK and was eligible for tax at source. What you have said has made me doubt the advice I was given and shall make enquiries with HMRC.
Claiming married tax allowance for my wife was an outside chance at best but always worth asking, thanks.
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Old Sep 24th 2017, 12:21 pm   #8
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Default Re: HMRC Marriage Allowance

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Originally Posted by kompani101 View Post
I shall investigate further but on both times I have asked previously I was told it is only payable in the UK and must be taxed at source. It is a private annuity not linked to government. Thanks.
Just to clear up one point you raised, pensions and annuities can still be paid in the UK without tax deducted, so long as the recipient is living overseas and therefore not liable for taxes in the UK.

So for the financial advisor and annuity company to say "it must be paid in the UK, and for that reason tax must be deducted" is a non-sequiteur.
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Old Sep 24th 2017, 12:27 pm   #9
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Default Re: HMRC Marriage Allowance

I am constantly disappointed in 'professional' advice I had been given in the UK especially as my sources have always been large, reputable and highly recommended companies. It looks like I need to completely reassess my tax/financial positions.
Many thanks for your help, it has been greatly appreciated.
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Old Sep 24th 2017, 12:35 pm   #10
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Default Re: HMRC Marriage Allowance

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Originally Posted by kompani101 View Post
I am constantly disappointed in 'professional' advice I had been given in the UK especially as my sources have always been large, reputable and highly recommended companies. It looks like I need to completely reassess my tax/financial positions.
Many thanks for your help, it has been greatly appreciated.
You are very welcome.
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Old Sep 24th 2017, 2:49 pm   #11
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Default Re: HMRC Marriage Allowance

I would have thought to take advantage of pensions etc paid gross in the Philippines, you would have to be on a permanent visa....ie a SRRV or 13a. Not a tourist visa. Would the BIR certify a DTT whilst on a tourist visa? I suspect not if I have understood the thread correctly.

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Old Sep 24th 2017, 3:21 pm   #12
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Default Re: HMRC Marriage Allowance

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Originally Posted by springsteen11 View Post
I would have thought to take advantage of pensions etc paid gross in the Philippines, you would have to be on a permanent visa....ie a SRRV or 13a. Not a tourist visa. Would the BIR certify a DTT whilst on a tourist visa? I suspect not if I have understood the thread correctly.

Regards

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That is likely true - HMRC would be unlikely to recognize you as tax resident overseas if you can't prove you are tax resident in another country. In other words, HMRC will want to be sure that you are tax resident somewhere, to stop you becoming a tax nomad, paying tax nowhere.
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Old Sep 25th 2017, 12:51 am   #13
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Default Re: HMRC Marriage Allowance

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Originally Posted by Pulaski View Post
That is likely true - HMRC would be unlikely to recognize you as tax resident overseas if you can't prove you are tax resident in another country. In other words, HMRC will want to be sure that you are tax resident somewhere, to stop you becoming a tax nomad, paying tax nowhere.
That's exactly what I said - you need to be on a residents visa here and have a TIN from BIR before the BIR will certify the HMRC form. The whole point of the DTT between UK and whatever country you reside in is to enable tax to be paid in one jurisdiction. For HMRC to instruct an annuity provider to apply an NT code, they, HMRC, want to know you are registered for tax in your country of residence. I had a hiccup earlier this year when HMRC sent me revised codings for this tax year. for some reason they had put me back on full UK codings as though I was living there! Through the government Gateway it was sorted within a couple of days , with apologies and a comment that a note has been put on my file to stop it happening again. Now both my UK annuities are back to NT.
Kompani101s advisors were correct in that he would pay UK tax on his annuity, assuming he was tax resident in the UK , but should have told him he could claim relief once tax resident elsewhere. The thing about only paying into a UK bank account is not that unusual - there have been other threads on BE where folks have been in the same position.
So until kompani gets a residents visa, fills in the DTT(individual) , gets it certified by the BIR here, returns it to HMRC , then he will have UK tax deducted at source.
Form DT individual - dtindividual.pdf
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Old Sep 26th 2017, 2:01 am   #14
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Default Re: HMRC Marriage Allowance

Quote:
Originally Posted by quiltman View Post
That's exactly what I said - you need to be on a residents visa here and have a TIN from BIR before the BIR will certify the HMRC form. The whole point of the DTT between UK and whatever country you reside in is to enable tax to be paid in one jurisdiction. For HMRC to instruct an annuity provider to apply an NT code, they, HMRC, want to know you are registered for tax in your country of residence. I had a hiccup earlier this year when HMRC sent me revised codings for this tax year. for some reason they had put me back on full UK codings as though I was living there! Through the government Gateway it was sorted within a couple of days , with apologies and a comment that a note has been put on my file to stop it happening again. Now both my UK annuities are back to NT.
Kompani101s advisors were correct in that he would pay UK tax on his annuity, assuming he was tax resident in the UK , but should have told him he could claim relief once tax resident elsewhere. The thing about only paying into a UK bank account is not that unusual - there have been other threads on BE where folks have been in the same position.
So until kompani gets a residents visa, fills in the DTT(individual) , gets it certified by the BIR here, returns it to HMRC , then he will have UK tax deducted at source.
Form DT individual - dtindividual.pdf
Thanks for your excellent advice. I'm hoping by years end to be a resident of the Philippines on a 13a visa which will enable me to change my UK tax status etc.
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Old Sep 26th 2017, 3:50 pm   #15
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Default Re: HMRC Marriage Allowance

Im not sure wheather this is the right thread or not.. but may I ask about how old can you be to start receiving state pension if you're living in the Philippines? I've read somewhere that as early as aged 55 years old, you'll be entitled to your UK State pension as long as you've paid the right year credit, is this true?
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