Sprouts offered in return for UK pension answers
Mar 10th 2010, 4:24 pm
#1
Septic Sprout
Thread Starter
Joined: Aug 2004
Location: Shanghai
Posts: 7,993
Sprouts offered in return for UK pension answers
Tried to practice what I preach by searching a bit but didn't turn up anything that specifically matched my question so here goes:
Background
Present day
I contacted HMRC to get a pension statement and find out how much I'd have to pay if I wanted to make up any NI contributions (when I left the UK I'd done 19 years). They wrote back after some delay to tell me about the certificate thingy and said that this meant I was liable for NI contributions for those 3 years whether I liked it or not. They also said they'd contacted my employer in the UK but had no reply and they couldn't help me until they'd talked to my employer.
I got hold of HR/payroll in the UK. Of course the staff have all changed and no-one knows anything about this. They have talked to their 'tax advisors' (some external company) and then told me:
1) That I shouldn't have to pay NI as I've been paying SS in the US, and
2) The tax advisors are asking HMRC whether they want us to try to claw back the US SS contributions somehow and pay them to HMRC.
I'm looking for any comments or suggestions as to my situation. Does any of this seem right? What steps should I take next? Not sure how much I trust my employer not to balls this up again.
On retirement I think I will be paid my UK pension based on the number of years contributions I've made (both from while I lived there plus any additional years' contributions I make) and also I will get a US pension, presumably based on the number of years I contribute here.
I acknowledge the fact that my understanding may be completely wrong (know next to bugger all about this stuff basically - never really took the time before to understand - bit daft I know).
Is there anything else I need to know about this? All advice or input gratefully received.
Background
- Moved from UK to US in March 2005.
- Since that time have been making US SS contributions from my paycheck.
- Unbeknown to me the UK arm of my employer had applied for a Certificate of Continuing UK Liability with HM Revenue & Customs that apparently means that NI contributions should have been made for the period 2005-2008. They didn't make those contributions. I never expected them to either - I just didn't know about this certificate.
Present day
I contacted HMRC to get a pension statement and find out how much I'd have to pay if I wanted to make up any NI contributions (when I left the UK I'd done 19 years). They wrote back after some delay to tell me about the certificate thingy and said that this meant I was liable for NI contributions for those 3 years whether I liked it or not. They also said they'd contacted my employer in the UK but had no reply and they couldn't help me until they'd talked to my employer.
I got hold of HR/payroll in the UK. Of course the staff have all changed and no-one knows anything about this. They have talked to their 'tax advisors' (some external company) and then told me:
1) That I shouldn't have to pay NI as I've been paying SS in the US, and
2) The tax advisors are asking HMRC whether they want us to try to claw back the US SS contributions somehow and pay them to HMRC.
I'm looking for any comments or suggestions as to my situation. Does any of this seem right? What steps should I take next? Not sure how much I trust my employer not to balls this up again.
On retirement I think I will be paid my UK pension based on the number of years contributions I've made (both from while I lived there plus any additional years' contributions I make) and also I will get a US pension, presumably based on the number of years I contribute here.
I acknowledge the fact that my understanding may be completely wrong (know next to bugger all about this stuff basically - never really took the time before to understand - bit daft I know).
Is there anything else I need to know about this? All advice or input gratefully received.
Mar 10th 2010, 6:12 pm
#2
Joined: Apr 2005
Location: Milwaukie, Oregon
Posts: 9,965
Re: Sprouts offered in return for UK pension answers
On retirement I think I will be paid my UK pension based on the number of years contributions I've made (both from while I lived there plus any additional years' contributions I make) and also I will get a US pension, presumably based on the number of years I contribute here.
You must have paid 10 quarters into US social security before you can transfer any of your UK one into it.
Mar 10th 2010, 6:25 pm
#3
Just Joined
Joined: Mar 2010
Posts: 7
Re: Sprouts offered in return for UK pension answers
LMAO...ridiculous!
Mar 10th 2010, 6:40 pm
#4
Chocoholic !
Joined: Jun 2007
Location: Houston, TX - Officially Not Shit since 2009
Posts: 2,324
Re: Sprouts offered in return for UK pension answers
All I can add is our experience.
Hubby is L1A and dude and I are L2.
Hubby's work applied for a Certificate of Continuing UK Liability before we left 18 months ago. He is getting paid by the US with no deductions for SS or Medicare. The UK arm are paying his National Insurance contributions each month and we know this is happening as he gets a UK payslip each month showing this transaction. I seem to remember that this set up can continue for a maximum of 5 years and then he must start paying US SS and Medicare (and stop UK obviously).
If we are still here we then plan to make voluntary contributions to his pension until he has paid enough to claim his full UK pension. I may do the same for my state pension.
The UK arm are also making employer and employee contributions to his UK company pension while we are over here as part of his contract. They then claw this back from the US arm at the end of each year. Again if we plan to stay - green card - then he will have to freeze his UK pension and go into the US scheme.
Hubby is L1A and dude and I are L2.
Hubby's work applied for a Certificate of Continuing UK Liability before we left 18 months ago. He is getting paid by the US with no deductions for SS or Medicare. The UK arm are paying his National Insurance contributions each month and we know this is happening as he gets a UK payslip each month showing this transaction. I seem to remember that this set up can continue for a maximum of 5 years and then he must start paying US SS and Medicare (and stop UK obviously).
If we are still here we then plan to make voluntary contributions to his pension until he has paid enough to claim his full UK pension. I may do the same for my state pension.
The UK arm are also making employer and employee contributions to his UK company pension while we are over here as part of his contract. They then claw this back from the US arm at the end of each year. Again if we plan to stay - green card - then he will have to freeze his UK pension and go into the US scheme.
Mar 10th 2010, 10:19 pm
#5
Septic Sprout
Thread Starter
Joined: Aug 2004
Location: Shanghai
Posts: 7,993
Re: Sprouts offered in return for UK pension answers
That is correct or depending on how much you paid into each you can combine them, or transfer part of one into the other so that you can claim the full amount for one of them. Like all things what is best to do depends an the circumstance at the time you can claim.
You must have paid 10 quarters into US social security before you can transfer any of your UK one into it.
You must have paid 10 quarters into US social security before you can transfer any of your UK one into it.
Not sure which bit is ridiculous. Pending explanation I'm afraid all that's worth is a rather manky beetroot.
All I can add is our experience.
Hubby is L1A and dude and I are L2.
Hubby's work applied for a Certificate of Continuing UK Liability before we left 18 months ago. He is getting paid by the US with no deductions for SS or Medicare. The UK arm are paying his National Insurance contributions each month and we know this is happening as he gets a UK payslip each month showing this transaction. I seem to remember that this set up can continue for a maximum of 5 years and then he must start paying US SS and Medicare (and stop UK obviously).
If we are still here we then plan to make voluntary contributions to his pension until he has paid enough to claim his full UK pension. I may do the same for my state pension.
The UK arm are also making employer and employee contributions to his UK company pension while we are over here as part of his contract. They then claw this back from the US arm at the end of each year. Again if we plan to stay - green card - then he will have to freeze his UK pension and go into the US scheme.
Hubby is L1A and dude and I are L2.
Hubby's work applied for a Certificate of Continuing UK Liability before we left 18 months ago. He is getting paid by the US with no deductions for SS or Medicare. The UK arm are paying his National Insurance contributions each month and we know this is happening as he gets a UK payslip each month showing this transaction. I seem to remember that this set up can continue for a maximum of 5 years and then he must start paying US SS and Medicare (and stop UK obviously).
If we are still here we then plan to make voluntary contributions to his pension until he has paid enough to claim his full UK pension. I may do the same for my state pension.
The UK arm are also making employer and employee contributions to his UK company pension while we are over here as part of his contract. They then claw this back from the US arm at the end of each year. Again if we plan to stay - green card - then he will have to freeze his UK pension and go into the US scheme.
Is there a time limit for when I can transfer my UK pension into the US (or vice versa)? Anyone done this?
I'm at the tender age of 39 at the minute and have no idea where in the world I will be retiring so not sure whether that makes a difference.
Mar 11th 2010, 7:25 pm
#6
Joined: Apr 2005
Location: Milwaukie, Oregon
Posts: 9,965
Re: Sprouts offered in return for UK pension answers
Mar 13th 2010, 10:23 pm
#7
BE Enthusiast
Joined: Aug 2008
Location: Virginia
Posts: 978
Re: Sprouts offered in return for UK pension answers
Yer not going to get the best results if all you offer is a manky sprout! 
Mar 14th 2010, 8:29 am
#8
Ping-ponger
Joined: Jul 2002
Location: Dreich Alba
Posts: 12,006
Re: Sprouts offered in return for UK pension answers
That is correct or depending on how much you paid into each you can combine them, or transfer part of one into the other so that you can claim the full amount for one of them. Like all things what is best to do depends an the circumstance at the time you can claim.
You must have paid 10 quarters into US social security before you can transfer any of your UK one into it.
You must have paid 10 quarters into US social security before you can transfer any of your UK one into it.
Must admit the whole thing confuses me too.
Mar 14th 2010, 12:19 pm
#9
Ping-ponger
Joined: Jul 2002
Location: Dreich Alba
Posts: 12,006
Re: Sprouts offered in return for UK pension answers
Just read a letter about collecting US and UK pension, in the Sunday Times Money section - the reply included a special number for the DWP's International Pension Centre: 0191 218 7777 and said that is the place to call to get answers about this stuff.
