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Police Pension - leaving in UK

Police Pension - leaving in UK

Old Aug 21st 2009, 3:32 am
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Default Police Pension - leaving in UK

At the moment we are provisional residents only (temporary to all intents and purposes). We will be eligible to apply for permanent residency in Mar 2010. At the moment OH gets a UK police pension which "stays" in the UK bank where it is put into. He is taxed on it by UK govt. We have NO intention of bringing that money to Australia at all. My OH does not have any intention of working in Aussie now or in the future. I am the worker and can support our life style here. We use the money building up in the UK for travel and UK / European / US holidays.

My question - once permanent residents, leaving the pension in the UK bank, taxed by the UK do we have to declare it as income in Australia - especially as it will never touch Australian soil and is taxed so it's not as though we intend to seek exemption from tax.
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Old Aug 21st 2009, 5:32 am
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Default Re: Police Pension - leaving in UK

Originally Posted by jellibaby View Post

My question - once permanent residents, leaving the pension in the UK bank, taxed by the UK do we have to declare it as income in Australia - especially as it will never touch Australian soil and is taxed so it's not as though we intend to seek exemption from tax.
Yes....you will be taxed on your worldwide income.

However due to the double taxation agreement between the two countries you need only pay tax in Australia.

You need to arrange to have it paid tax fee in the UK.

It is pretty straightforward and both my wife and I have this arrangement.

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Old Oct 8th 2009, 4:33 am
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Default Re: Police Pension - leaving in UK

Thanks for that but .............. how would ATO find out about the income in the first place if we never bring it over to Aussie? As in NEVER bring it over to Aussie - and just allow the money to stay in the UK, taxed as it is now - by the UK government. I accept that if we brought it in at a later date then it would be taxable again but as we have no intention of bringing it over why do we HAVE to be taxed by ATO at all?
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Old Oct 8th 2009, 6:00 am
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Default Re: Police Pension - leaving in UK

The law is that your UK source pension income will be taxed in Australia once you have permanent residency.

Are you suggesting acting illegally? Surely not!

Best regards.
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Old Oct 8th 2009, 6:14 am
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Default Re: Police Pension - leaving in UK

Originally Posted by jellibaby View Post
Thanks for that but .............. how would ATO find out about the income in the first place if we never bring it over to Aussie? As in NEVER bring it over to Aussie - and just allow the money to stay in the UK, taxed as it is now - by the UK government. I accept that if we brought it in at a later date then it would be taxable again but as we have no intention of bringing it over why do we HAVE to be taxed by ATO at all?

Because you will be living in Australia, and abiding by Australian law. You can't just pick and choose the laws that you want to live by, irrespective of how ridiculous they are.


S
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Old Oct 8th 2009, 11:52 am
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Default Re: Police Pension - leaving in UK

This relates to a question I had.

We have PR visa, so when we move we will be Permanent Residents.

My husband gets an Army Pension.

If we don't bring his pension, but leave in here in UK in a bank account is it just the case of informing the Armed Forces Pension People - they stop taking UK tax off and we then pay the tax on it in Australia. Is this how it works? To me that sounds fair enough, as long as you aren't paying tax twice on it that seems okay!!

And then what if we decided to then use that money that we have kept in UK to spend in Australia - perhaps 2 years down the line, (i.e. use it as a depost on a property) do we then have to pay any other taxes on it when we bring it over???

Thanks
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Old Oct 8th 2009, 11:57 am
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Default Re: Police Pension - leaving in UK

Any payor of a pension will only apply the PAYE Coding they are advised by HM Revenue => you must deal with HM Revenue if your pension is to be taxed correctly.

As to the question of whether funds are remitted to Australia or not - it is an irrelevant issue. As a permanent resident who is tax resident in Australia you are taxed on income (and capital gains) wheresoever they arise in the world, irrespective of whether or not the income (or proceeds of disposal) are remitted to Australia.

If you are stuck - take professional advice.

Best regards.
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Old Jan 8th 2010, 12:14 am
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Default Re: Police Pension - leaving in UK

Originally Posted by Alan Collett View Post
Any payor of a pension will only apply the PAYE Coding they are advised by HM Revenue => you must deal with HM Revenue if your pension is to be taxed correctly.

As to the question of whether funds are remitted to Australia or not - it is an irrelevant issue. As a permanent resident who is tax resident in Australia you are taxed on income (and capital gains) wheresoever they arise in the world, irrespective of whether or not the income (or proceeds of disposal) are remitted to Australia.

If you are stuck - take professional advice.

Best regards.
Hi Alan

Hope you are well?

Quick question - and slightly off topic - have you heard anything on the grapevine when the 5 yearly review of the Double Taxation Agreement between Australia and the UK, which started 12 months ago (!), is likely to be concluded? It is normally a question of just dotting the I's and crossing the T's from the previous review and having it signed by the present incumbents but this one is taking ages! Perhaps there may be a link with the Henry Tax Review here? Perhaps they may even be considering putting us ex-UK over 60s Australian citizens on the same level playing field as born-and-bred Australians of the same age - now there's a hope!!

Many thanks

Jim
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Old Jan 8th 2010, 12:26 am
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Default Re: Police Pension - leaving in UK

Nope, I haven't heard anything on the subject as yet, Jim.

Hope all is well with you.
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Old Mar 19th 2010, 12:08 am
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Default Re: Police Pension - leaving in UK

Hi,
I am a retired Fire Officer and my OH and I now live, since February this year, in Victoria. My OH has a job here and her employers wish to sponsor us for Permanent Residency.
I am in a similar position as to transferring the tax on my UK Pension from the UK to the Aussie system, however if we get PR we would wish to sell our house in the UK.
Can you advise whether this would be better done whilst still Temporary Residents or whether there is no tax implication in waiting till our PR is granted?
We would prefer to wait until the housing market in the UK picks up although if there is a tax implication in that wait then it would have to be weighed up.
Thanks
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Old Mar 19th 2010, 12:17 am
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Default Re: Police Pension - leaving in UK

Originally Posted by brandoni View Post
Hi,
I am a retired Fire Officer and my OH and I now live, since February this year, in Victoria. My OH has a job here and her employers wish to sponsor us for Permanent Residency.
I am in a similar position as to transferring the tax on my UK Pension from the UK to the Aussie system, however if we get PR we would wish to sell our house in the UK.
Can you advise whether this would be better done whilst still Temporary Residents or whether there is no tax implication in waiting till our PR is granted?
We would prefer to wait until the housing market in the UK picks up although if there is a tax implication in that wait then it would have to be weighed up.
Thanks
You will not be able to get your pension paid gross from the uk tax authorities unless you have PR, and even then it will take some time. You need to send the form to the ATO and they certify you have PR and then you send it to the uk. We did ours in Dec and are still waiting! So no point in trying until PR.

Am less clear on the temp/perm tax issues re house selling so won't guess!
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Old Mar 19th 2010, 1:20 am
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Default Re: Police Pension - leaving in UK

Thanks for that info Scotty.
Are you any better off financially paying your tax on your Pension in Oz rather than in the UK or is it virtually the same?
Thanks
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Old Mar 19th 2010, 1:52 am
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Default Re: Police Pension - leaving in UK

Originally Posted by brandoni View Post
Thanks for that info Scotty.
Are you any better off financially paying your tax on your Pension in Oz rather than in the UK or is it virtually the same?
Thanks
If you are PR you don't get a choice - you become a tax resident and need to declare the pension and pay Oz tax.
Having said that for us it works out slightly better in Oz
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Old Mar 19th 2010, 4:29 am
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Default Re: Police Pension - leaving in UK

If you leave the pension money in the UK and can be sure that you will NEVER bring it to Australia, the chances of the Australian authorities knowing about it are almost zero.

However, who can know what the future holds? There are systems in place for the identification of funds when they are moved in or out of Australia so if it were me I would not run the risk of having to use some of your UK pension money in Australia one day, and then the whole thing being revealed.
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