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TAX on BT Pension

TAX on BT Pension

Old Mar 28th 2014, 3:53 am
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Default TAX on BT Pension

Hi I wonder if anyone can help.
I have been in Australia since the early 80s.
I am still working full time.
I have recently turned 60 and am now receiving a pension from British Telecom who I worked for for 12 years before coming here.
It's not much about 300 quid a month, it is paid into a UK bank.

Does anyone know if this is "income" in the sense of the word here in Oz and will I have to declare it for tax purposes.

OR will I have to pay UK tax on it.

I also received a "TaxFree" lump sum on my 60th birthday


I would really be grateful if someone could answer this for me.

Thanks
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Old Mar 28th 2014, 4:45 am
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Default Re: TAX on BT Pension

You post covers a number of issues and I will keep it basic here:

Your pension payments are deemed as income.

Your will need to declare it

You can request that you tax payable on the ongoing income be done through Australia by contacting the ATO and completing the required form which they will send off to HMRC for you.

You are also liable for tax on part of the lump sum - that is the earnings on the lump sum component only not the entire amount. Too complex to discuss here.

uk & Aust have a tax agreement where any tax paid in the Uk can be offset against tax in Australia.

Your should contact the ATO to get this sorted for you or a professional.

cheers john
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Old Mar 28th 2014, 4:52 am
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Default Re: TAX on BT Pension

Thanks John
The money is being paid into my UK account and I was going to employ the Ostrich method and ignore it as the lump sum was deemed as tax free and it is only a couple of hundred quid a month
Paul
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Old Mar 30th 2014, 11:40 am
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Default Re: TAX on BT Pension

The general rule is that if you are a tax resident of Australia you are subject to tax in Australia on your worldwide income.

This is modified for many types of temporary visaholder who are living in Australia.

Under the Tax Treaty the pension income is solely taxable in Australia, so you should complete the relevant Treaty form and send it to the ATO for stamping and onfowarding to HM Revenue.

This will lead to:

> The issuing of a NT (No Tax) PAYE Coding to the administrators of the pension.

> The repayment of tax deducted under PAYE.

The UK pension income should then be declared on your Australian tax return, with tax payable in Australia on the same.

You should not claim a credit for UK tax withheld when the pension is included on your Australian tax return. I know that many do this, but it is not technically correct to do so.

Best regards.
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Old Apr 10th 2014, 2:48 am
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Default Re: TAX on BT Pension

Thanks Alan
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Old Apr 12th 2014, 6:13 am
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Default Re: TAX on BT Pension

Or the other angle of screw them, will they ever find out about it? Keep it in the UK to use when/if you ever go back to visit!
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Old Apr 12th 2014, 6:25 am
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Default Re: TAX on BT Pension

Originally Posted by Tramps_mate
Or the other angle of screw them, will they ever find out about it? Keep it in the UK to use when/if you ever go back to visit!

http://www.ato.gov.au/Business/Inter...f-information/

Best regards.
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Old Apr 12th 2014, 6:41 am
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Default Re: TAX on BT Pension

I know they may share but do they automatically check everyone? No? If you give them reason they may..

It was just another point of view! hth
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Old Apr 12th 2014, 8:45 am
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Default Re: TAX on BT Pension

Originally Posted by Tramps_mate
Or the other angle of screw them, will they ever find out about it? Keep it in the UK to use when/if you ever go back to visit!
It's very much against forum rules to suggest or condone any action that is illegal.
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Old Apr 12th 2014, 9:37 am
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Default Re: TAX on BT Pension

I would like to thank everyone for their replies and I have taken the advice and I am going to contact a tax/immigration consultant.
To be honest it's not the greatest sum of money but I know what these government tax collectors can be like.
They've got to get as much as they can in to pay for all the fiddles that the elected members get up to

Thanks again

Paul

Interesting though if you follow the links re foreign earnings, it states that pensions are not considered to be that, so I don't know
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