Pension payments
#1
Pension payments
We are going to do our taxes this week my husband receives a pension from Oxford University it is paid into our UK Barclays Account and is taxed by HMRC, will we need to tell the person preparing our taxes about the payments. We are GC holders not citizens.
#2
Re: Pension payments
Hopefully someone with experience will be along to comment, but I believe you should change your pension to be paid without any tax withholding in the uk.
There isn't any difference between permanent residents and us citizens with regards to tax.
There isn't any difference between permanent residents and us citizens with regards to tax.
#3
Re: Pension payments
Tom is right, your husband's pension should he paid gross in the UK and taxed in the US.
He will probably need to complete a UK tax return to get the tax he has paid refunded.
He will probably need to complete a UK tax return to get the tax he has paid refunded.
#4
Lost in BE Cyberspace
Joined: Jan 2006
Location: San Francisco
Posts: 12,865
Re: Pension payments
And the specific answer to the OPs question is yes, the US tax preparer will need to know if any pension was paid in 2017. At this point, you'll probably have to claim a foreign tax credit for the tax paid to the UK, which may or may not be as much as the tax paid there.
Last edited by Giantaxe; Feb 7th 2018 at 2:10 am. Reason: No state income tax in Texas!
#5
Re: Pension payments
And the specific answer to the OPs question is yes, the US tax preparer will need to know if any pension was paid in 2017. At this point, you'll probably have to claim a foreign tax credit for the tax paid to the UK, which may or may not be as much as the tax paid there.
#6
Re: Pension payments
For the purposes of your tax return you just need to be able to tell the person doing it what the total UK income was and how much UK tax was paid. There is no need to include UK paperwork with your US tax return just keep it for your records.
#7
BE Enthusiast
Joined: Nov 2012
Posts: 902
Re: Pension payments
The pension income is solely US taxable under Article 17 of the treaty. You'd reclaim the tax withheld in the UK; and have no foreign tax credit to claim in the US.
#8
BE Forum Addict
Joined: Aug 2013
Location: Athens GA
Posts: 2,133
Re: Pension payments
For the UK you will need the P60 to claim the tax refund. As others have said, the pension should be paid gross in the UK.
#9
Re: Pension payments
And the specific answer to the OPs question is yes, the US tax preparer will need to know if any pension was paid in 2017. At this point, you'll probably have to claim a foreign tax credit for the tax paid to the UK, which may or may not be as much as the tax paid there.
#10
BE Forum Addict
Joined: Aug 2013
Location: Eee Bah Gum
Posts: 4,129
Re: Pension payments
Good info here already.
I will just add that when I started receiving a UK pension while living in the USA I was able to file the paperwork to stop HMRC taking out tax and as I'd only paid 3 or 4 months of taxes by the time the paperwork went through they refunded the tax into my next pension payment. (OP does not say how long HMRC have been taking the payments, but probably too late now to get it refunded without filing a UK tax return)
I keep all my monthly pension advice statements in case I am audited by the IRS.
I will just add that when I started receiving a UK pension while living in the USA I was able to file the paperwork to stop HMRC taking out tax and as I'd only paid 3 or 4 months of taxes by the time the paperwork went through they refunded the tax into my next pension payment. (OP does not say how long HMRC have been taking the payments, but probably too late now to get it refunded without filing a UK tax return)
I keep all my monthly pension advice statements in case I am audited by the IRS.
#11
Forum Regular
Joined: Dec 2017
Posts: 78
Re: Pension payments
I claimed an old pension from the UK a few years ago and filed a 'double taxation' form, the UK tax was then refunded to me.