Kingsboy48

You can open a UK bank account using www.wise.com even if you are non resident.

Pulaski

This has already been recommended in post #13 above, and partially discredited, in post 14 above.

Jakeinaka

Again, Wise is not a bank.

As Pulaski mentioned, it IS a good service, I use it regularly, but some/many pension providers including mine do not accept it.

capnbirdseye

My pension company gave me the run-around about "it's not a proper bank account". I pushed back hard, opened a formal complaint with them (didn't have to take it to the regulator), and they caved and agreed to pay into a Wise account. Not only did they cave, but they also paid me compensation for the hassle of arguing with them + the difference in value between when I asked for the money and when they finally disgorged it!

The argument I made was that:

1. It's impossible for a US Person to get a UK bank account these days.
2. Sending me a UK Pounds cheque in the mail would be insecure and involve me losing on the exchange rate if I paid it into a US bank.
3. If I want to take the "risk" of paying into Wise, that's on me - I even offered to sign a waiver (they didn't take me up on that).

As to the alleged risk of having money in Wise, I didn't leave it there, I transferred it to my US bank account as soon as it was deposited.

All that said, EverBank (the bank formerly known as TIAA) offers is a "real bank" in the USA (with FDIC guarantees, etc.), so a pension provider would have no reasonable argument against paying to them. I went as far as opening an account with EverBank as a fallback before my pension provider caved.

Note that UK Pounds held in an EverBank account are not reportable on 8938 and FBAR, because they are a US domestic account, just denominated in a foreign currency. A Wise account is a foreign custodial account that should be reported like any other foreign bank account.

rammygirl

Well done. There is no reason they can’t pay into a foreign account or any other regulated account. If the UK government pension can be paid overseas, as can my local government pension then I really don’t see why private providers can’t do it. They really need to take notice and sort these stupid rules, even if requiring a disclaimer to do it.

Kiwipaul

I've been receiving a private pension from a previous employer in the UK for 10 years now. They send my pension to my Oz bank a/c monthly and they have never missed a payment. As above you do need to complete a UK tax form declaring you are no longer a UK resident to enable you to receive the pension Tax free from the UK gov.
I did this after staring the pension and so I was taxed for a couple of months but once I'd submitted the tax form I received all the tax I had paid refunded.

The money IS subject to tax in Oz if you earn above the Oz tax threshold but with SAPTO that is $32,000 (single) or $61,000 (couple).

rammygirl

SAPTO only applies if you are eligible for age pension or other Centrelink payments though.

Kiwipaul

No it increases the amount of money you receive before having to pay tax. This income is from investments, saving, earning, foreign pensions, etc.
It doesn't include Sup because that is tax free anyway.

Without SAPTO the tax rate is: taxable income of $18,201 to $45,000 – 19% of excess over $18,200;

rammygirl

Yes but to be eligible for SAPTO you have to be eligible for other Centrelink payments like age pension. You don’t just get it because of age. I’m unlikely to qualify for age pension or benefits so can’t take advantage of SAPTO even though I’m old enough.

old.sparkles

Info on SAPTO - https://www.ato.gov.au/individuals-a...ers-tax-offset

rammygirl

yes that is what I mean I’m not eligible for age pension because assets/ income too high. That means I can’t claim SAPTO. It isn’t just about age.

old.sparkles

I suggest that you read that again then, as not being eligible for the age pension due to income / assets does not mean you automatically not eligible for SAPTO

Kiwipaul

I'm not eligible for the pension because my assets / income are too high but i still get SAPTO higher income tax limit and it means I've not paid any income tax since i retired.

https://www.ato.gov.au/individuals-a...t#Incomelimits

On the Income tax return it's under OFFSETS and Seniors and pensioners tax offset I use offset code A

rammygirl

Ah OK but do you get the full amount as it appears it is reduced over certain limits?
Our earnings from sources other than super May be too high? I will ask my accountant this year.

Kiwipaul

Could be The max you can earn without paying tax is $32,279 and it reduces when you earn more than $50,119.

Maybe you should get a more competent accountant if they didn't even know about SAPTO.