Originally Posted by ex_REME

Hi Almost

I plan that my pension will always be taxed in the UK, so under the Taxation Treaty I will not pay any Canadian tax on it. Is this the way you see the Taxation Treaty?

Say I earn £12,000 a year in Pension, take off the UK personal allowance of approx £5,000, then I'm taxed on the remaining £7,000 at 20% (from Apr 2008) makes £1,400 in tax. I declare £12,000 on my Canadian tax return, then deduct it under the tax treaty, so pay no Canadian tax on it.

If I opt to have the pension tax free from the UK I'll escape UK tax but I'll pay Canadian tax at my highest (think they call that "marginal") rate which I expect to be about 38% and on all of the £12,000. That makes about £4,600 ie lots more than when I declare the pension in UK.

Does that add up to you?? There must be some smart brains out there that can see the problem with my simple sums!!

Ex

Originally Posted by Ad 12345

Sorry to say once you "land" the UK/Canadian Tag Tax team pass the baton to the CRA to whom you report all income. Sadly you cannot pick and choose to which country you pay which tax.