aldavidson

We own property in Canada and in USA. We are retired and spend around 6 months of the year in each country. Now approaching UK State Pension age I’m getting organized to send in my application for payment.

The very strange discriminatory UK policy on annual uprating means that USA applicants receive annual uprating, but Canada residents do not, so obviously it would be advantageous to apply to my UK State pension as a USA resident. The application form I have (IPC BR1) does not mention that anything needs to be provided as proof of residence. Just need to give my “permanent address”. We have one in each country.

Has anyone in a similar position applying for a UK State pension from USA been asked to provide proof of US residence? If so what document(s) were requested and which were provided and accepted?

Novocastrian

Where do you file/pay your taxes and what is your (visa) status in each country?

not2old

OP, are you a permanent resident in the US, or spending time stateside as Canadian snowbirds?

Is your permanent home in Canada, do you file Canadian tax returns on your world income in Canada?

Should you apply for 'UK state pension' using a US address, having the state pension going into a US bank account, then you would need to declare the income in the US to pay US tax on it as would you your world income.

Then its a messing around & sorting out the with tax filing in Canada & US

Davita

I snowbirded to Arizona and declared USA to be my residence as I spent more time there than Canada. I had a USA Tax ITIN number but, as my world-income was less than minimum to pay tax, the IRS told me to only file 1040 when my income increased.
UK never asked for proof of residence but I had some proof, including a drivers licence from AZ, just in case.
I also kept my UK bank account in Channel Islands where my UK OAP was paid.

I'm aware that may not be kosher but, imo, the UK Gov attitude to this concern isn't acceptable either.

scot47

A few years ago a legal action was raised against the UK Government by a group of pensioners resident in South Africa. the issue was the freezing of the stat Retirement Pension for those living in some jurisdictions (eg South Africa, Canada). The pensioners lost the case and the Law Lords found in favour of HMG.

not2old

Imagine that

How you managed not paying tax is puzzling?

https://www.americanimmigrationcounc...on-number-itin

https://www.irs.gov/uac/about-form-w7


and that drivers license question - did you have to take the AZ driving test, or exchange your Canadian license?

http://immigration.procon.org/view.r...ourceID=005535

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Davita

1. Not puzzling...both myself and wife have USA ITIN cards (we're retirees)...we filed 1040's until IRS told us to only file if our income was over the minimum threshold. This was considered paper-saving. When I sold our property I paid Capital Gains Tax on the gain, both in USA and Canada.

2. Your driver's license link is irrelevant...that's something to do with illegal immigrants. The following is relevant...

"A few states still allow people to use an ITIN instead of an SSN to apply for a driver’s license. And some banks and credit unions allow ITIN holders to open accounts or apply for loans."

I also had an Arizona-plated Cadillac in my name....and a bank account in B of A which held a collateral loan on our property.

Edit: We used our Canadian license to qualify...I think, as it was some years ago...but I'm sure I wasn't tested. I recall we didn't need to but, I'm sure you're aware, Americans use their driver's license for lots of ID things...including qualifying for discounts in stores....writing cheques ...you name it.

not2old

Davita @ post #7, thank you

For the OP, should you be considering using the US address just to get indexed UK state pension, be watchful of the tax rules as well as anything else that may come out of the woodwork.

Is it worth the (potential) hassle?

On the question of 'snowbird', there is the 'substantial presence test' rule for foreign nationals with respect to taxation.

It is also possible for Canadians to have a US bank account in the US

In the following link for information purposes only

Canadian Snowbirds and U.S. Tax

updated information on ITIN for Canadians

http://madanca.com/tax-id-numbers-in...for-canadians/


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not2old

One more item on that income & US income tax, Davita appeared to have found a way around it.

On the US side, from the IRS website

"The United States has tax treaties with a number of foreign countries. Under these treaties, residents (not necessarily citizens) of foreign countries are taxed at a reduced rate, or are exempt from U.S. taxes on certain items of income they receive from sources within the United States. These reduced rates and exemptions vary among countries and specific items of income. Under these same treaties, residents or citizens of the United States are taxed at a reduced rate, or are exempt from foreign taxes, on certain items of income they receive from sources within foreign countries. Most income tax treaties contain what is known as a "saving clause" which prevents a citizen or resident of the United States from using the provisions of a tax treaty in order to avoid taxation of U.S. source income.

If the treaty does not cover a particular kind of income, or if there is no treaty between your country and the United States, you must pay tax on the income in the same way and at the same rates shown in the instructions for the applicable U.S. tax return."

Resident of Canada, paying income tax in Canada on world income

So basically, with no income earned or derived in the US, could solve the problem & maybe, just maybe no need to have a ITIN.

Then there is the 'getting a US Drivers license' using a US address + your provincial drivers abstract, without having to take a test or handing over the Canadian license.... for another discussion



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Davita

My recollection for the need to get an ITIN was based on the USA residency rules. Snowbirds are permitted to stay in USA for up to six months without the need but, if continuous each year, it is averaged until it's about three months....something like that.

We can tear our hair out talking law but the OP asked if anyone had applied for UK OAP from USA and I responded that, when qualified by age, I did....and they never asked for proof of that USA residency.

I subsequently moved and advised UK that I'm no longer in the USA.

They recently sent a couple of letters to my address asking if I'm dead yet. I was on holiday in Bali, and didn't respond, so they cut-off my pension until I told them I'm still alive (or almost as good as an 80 year old can be alive)

not2old

"The 'substantial presence test' rule for foreign nationals"

https://www.irs.gov/individuals/inte...-presence-test

That as well as all the posts above should give the OP some idea of the things they need to take into consideration

aldavidson

Thanks very much to Davita for the clear answer to my specific question on whether proof of country of residence was requested by UK DWP for new State Pension applicants. Confirmed what I expected that no proof of residence is requested but it's a good idea to be organized to have it available at the time of application in case it is requested.

Thanks to others for their advice on tax stuff etc - which I'm very familiar with already and am not concerned about.

bats

There's been a whole load of stuff about snowbirds thinking they can spend more time in the USA than they are really allowed. Also that it's going to be more noticeable/ documented now with electronic passport reading etc.

bats

You know that you get the updated amount while you're in a country that it's paid in? So there's really no need for all this.

JonboyE

In this sort of situation I would go out of my way to avoid becoming a US taxpayer in the eyes of the IRS.