Pension at 55 - Removing Full Pot
Hello All,
Forgive me if this has been covered but I have been reading so much about this and not really getting the full picture and my head is spinning! My question is really fairly simplistic. I have a fund that has been doing nothing for years and it makes sense to draw it out when I turn 55 next month. As a UK citizen who is green card resident in the UK, what level of taxation is applied by the Inland Revenue in the UK. If it helps, the fund is no more than about 31K GBP. I realise their are other implications, but as a starting point, I would like to establish the UK taxation status. Thank you for reading. |
Re: Pension at 55 - Removing Full Pot
Originally Posted by MickM62
(Post 12326182)
.... As a UK citizen who is green card resident in the UK, .....
Unless it is a government pension (resulting from employment by the government, not a state pension), a pension is taxed only by the country where you are living. |
Re: Pension at 55 - Removing Full Pot
Originally Posted by Pulaski
(Post 12326190)
Which country do you live in? (Is that a typo I quoted?)
Unless it is a government pension, a pension is taxed only by the country where you are living. The fund is Defined contribution (money purchase). Hope this helps and thank you. |
Re: Pension at 55 - Removing Full Pot
If you withdraw it all as a lump sum it will only be taxed in the UK. Have you remembered to report it on your FBAR & 8938 every year?
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Re: Pension at 55 - Removing Full Pot
If you withdraw it all as a lump sum it will only be taxed in the UK. It said that a lump sum payment would be taxed in the US? |
Re: Pension at 55 - Removing Full Pot
Originally Posted by formfill1
(Post 12326669)
I think I saw a post a couple of weeks ago about where US pensions would be taxed for a UK citizen/resident.
It said that a lump sum payment would be taxed in the US? |
Re: Pension at 55 - Removing Full Pot
Originally Posted by Cook_County
(Post 12326555)
If you withdraw it all as a lump sum it will only be taxed in the UK. Have you remembered to report it on your FBAR & 8938 every year?
If I am honest, I think the last contribution in was in 1996 and I did not even realise the plan was around until by chance I got forwarded some mail a few weeks back. Now I am extremely worried. |
Re: Pension at 55 - Removing Full Pot
Originally Posted by MickM62
(Post 12326702)
.... Now I am extremely worried.
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Re: Pension at 55 - Removing Full Pot
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Re: Pension at 55 - Removing Full Pot
Thanks Guys!!!
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Re: Pension at 55 - Removing Full Pot
Originally Posted by formfill1
(Post 12326669)
I think I saw a post a couple of weeks ago about where US pensions would be taxed for a UK citizen/resident.
|
Re: Pension at 55 - Removing Full Pot
Based on the information you have provided. You are a U.K. resident taxpayer who is resident in the U.K. for tax purposes but have a green card.
You do not become a resident alien in the U.S. until the first day you reside in the U.S. so as a U.K. resident taxpayer you can claim the PCLS and take the full pension pot after the 25% tax free cash at your marginal rate of income tax in the U.K. |
Re: Pension at 55 - Removing Full Pot
Originally Posted by Dominic0012
(Post 12326850)
Based on the information you have provided. You are a U.K. resident taxpayer who is resident in the U.K. for tax purposes but have a green card.
You do not become a resident alien in the U.S. until the first day you reside in the U.S. so as a U.K. resident taxpayer you can claim the PCLS and take the full pension pot after the 25% tax free cash at your marginal rate of income tax in the U.K.
Originally Posted by MickM62
(Post 12326198)
Yes I am an idiot, one generally does not need a green card as a UK citizen in the UK, I meant I am in the US.
The fund is Defined contribution (money purchase). Hope this helps and thank you. |
Re: Pension at 55 - Removing Full Pot
Originally Posted by durham_lad
(Post 12326860)
He updated his position later in the thread.
I think I have this all sorted now. |
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