Eagle1403

Hi folks,

My Filipino wife and I are moving to Manila next year.

I have no plans to work.

However, I will likely sell our house and put the funds left after paying the mortgage off into my bank account in the UK.

I may also receive my pension from my employer if I get to retire early from work rather than resign.

I'm wondering if I have to do anything in respect of paying "income tax" from my pension from my employer, or will it automatically be taxed before is deposited in my bank each month, like my salary is?

Cheers
Allan

mikemike

Yes your pension paid in the Uk will be subject to UK income tax, plus you get the full personal allowance which for this year is 11,500 pa?

You will not pay income tax in the Philippines on overseas income as you are not a citizen.

Angel1403

Hi Mike,

Thank you for the info

Is it an "automatic" deduction at source prior to it being paid into the bank, or do I need to complete a paper self assessment tax return and send it to the UK every year?

My pension is not huge so in reality i wont be paying much tax. I wonder if there is a minimum amount of "income" above the tax allowance that they will want a form completed and payment made?

How about National Insurance....I'm guessing I don't pay that when not working?

Thank you very much for the information

Oh....I had to re register and change my name to Eagle1403, as I forgot my password as Angel1403 and the change password, robot entry tool kept failing, so I gave up after 10 attempts....

Cheers
Allan

geoff52

There is new banking law coming into effect. Where a bank has to report you interest to the government where your permanent address is.

Eagle1403

Ah ok, I guess we will hear more about that once it's inacted.

In any event, I won't be working in the Philippines so won't pay any tax their.

Cheers

mikemike

As it is an employment pension, tax will be deducted at source. Only the state pension is paid gross. This years allowance is £11500 before tax is paid.

NI is only deducted from employment earnings not pensions as they are unearned income. In saying that you may wish to ask the State government on line resource how much of a state pension you may be entitled to and if you can add voluntary contributions in order to maximise your state pension.

There has been a lot said about a new law that is designed to remove the personal allowance of anyone living overseas. Despite the talk there has been no action at this time.

There is political suicide and there is political suicide, more so as the present prime minister has made it clear that we, the great unwashed will have no time limits on our voting rights. removing tax allowances may see an upsurge in oversea voters actually voting and it would not be pretty.

Good news is the Philippines is only one of 17 countries that has the state pension index linked, Let us hope it stays this way.

quiltman

It's important to complete form P85 - download from HMRC - to inform HMRC you are leaving the UK. They will refund any tax overpaid.
Is your employer a private company, or classed as a government employer - Teaching, police, military etc? If private, you can apply for tax relief after being here for one FULL tax year and get it paid gross, then if your State pensions are below the tax free limit then you'll pay no UK tax, and no tax on funds remitted to the Philippines.

I'll send you a PM with some more detail to avoid repeating it all again here.
Here's link to definition of government Pensions - these are EXCLUDED from the DTT between UK/Philippines. INTM343040 - DT claims and applications - Types of income: Pensions and Annuities

Re Self assessment, it is possible HMRC will require you to fill one in but it is also possible they may say you don't need to. It depends on how they feel in the morning - unless of course you have other UK income such as renting your house, share dividends etc. I do one every year, takes me about 30 minutes and so far i've had a refund every year as HMRC get my tax code slightly wrong! This year it was £200 , last year £600, as my DTT application took them nearly 6 months to sort out!

Eagle1403

Thanks to everyone for the replies.

The info is very useful and appreciated 😀

Thanks also for the pm....i can open it after I make 3 posts?

Thanks again for the info....its always welcome 😀