TAX on BT Pension
#1
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
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
#2
BE Enthusiast
Joined: Feb 2014
Posts: 592
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
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
#3
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
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
#4
Migration Agent
Joined: May 2002
Location: Offices in Melbourne, Brisbane, Perth, Geelong (Australia), and Southampton (UK)
Posts: 6,459
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.
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.
#6
BE Forum Addict
Joined: Oct 2011
Posts: 1,217
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!
#7
Migration Agent
Joined: May 2002
Location: Offices in Melbourne, Brisbane, Perth, Geelong (Australia), and Southampton (UK)
Posts: 6,459
#8
BE Forum Addict
Joined: Oct 2011
Posts: 1,217
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
It was just another point of view! hth
#10
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
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