UK state pension and USA social security
Dec 31st 2017, 1:06 pm
#1441
Lost in BE Cyberspace
Joined: Jul 2016
Posts: 10,005
Re: UK state pension and USA social security
I am curious o the deferral, if one defers does that mean the weekly pension goes up forever, or just in year of deferral ?
Dec 31st 2017, 1:58 pm
#1442
Heading for Poppyland
Joined: Jul 2007
Location: North Norfolk and northern New York State
Posts: 14,522
Re: UK state pension and USA social security
Dec 31st 2017, 2:05 pm
#1443
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Re: UK state pension and USA social security
Thanks for that link! I'll read it. In terms of state pension age, my pension age is 65 and I reached it on by birthday in August 2015. That's what I meant by grandfathering (maybe I used the term incorrectly.)
Edit; The link confirms that the pension amount will continue to increase by 1% every five weeks, or 10.4% a year, if deferred. I don't see a mention of whether there's a limit as to an upper age beyond which you can't defer...
Edit; The link confirms that the pension amount will continue to increase by 1% every five weeks, or 10.4% a year, if deferred. I don't see a mention of whether there's a limit as to an upper age beyond which you can't defer...
Dec 31st 2017, 2:24 pm
#1444
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Joined: Nov 2007
Location: Beautiful Dorset, UK
Posts: 2,195
Re: UK state pension and USA social security
https://www.gov.uk/deferring-state-pension/what-you-get
Dec 31st 2017, 2:25 pm
#1445
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Posts: 8
Dec 31st 2017, 2:43 pm
#1446
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Joined: Dec 2017
Posts: 8
Re: UK state pension and USA social security
I have read various pension taxation threads and realize that everyone's case seems to be slightly different.I would be grateful for some help please, I’ve been goinground and round on the IRS and UK.Gov sites and still can’t find a definitive answer.
I was 66 on Sunday and last year I took a lump sum from UK STATE pension to catch me up from the 65 pension age in theUKand am now getting a full monthly pension.
It’s the only income I get from the UK.
I can’t seem to find out if I have to pay tax on that UK pension here in the US.
I’ve read about a treaty and it says that if I don’t have topay tax on any earnings in the UKI don’t have to pay tax on it here.
Apparently my yearly pension falls under the threshold of (approx)$15K/$16K for paying any tax in the UK.
My accountant who’s not used to this says I need a 1099Rfrom the UKbut because I don’t need to file taxes there I can’t get anything.
The IRS don’t take ‘international tax enquiries’ by phone.
Finally how would it be declared on my tax return,
I had no idea I had to declare pension income, either state or private and have also been receiving 2 x $600 (approx) for 14 years (since I've been here !!
Thank you to anyone who can hopefully simplify this for me.
To make things even more complicated, I was laid off inNovember and am currently fighting an unemployment claim
I was 66 on Sunday and last year I took a lump sum from UK STATE pension to catch me up from the 65 pension age in theUKand am now getting a full monthly pension.
It’s the only income I get from the UK.
I can’t seem to find out if I have to pay tax on that UK pension here in the US.
I’ve read about a treaty and it says that if I don’t have topay tax on any earnings in the UKI don’t have to pay tax on it here.
Apparently my yearly pension falls under the threshold of (approx)$15K/$16K for paying any tax in the UK.
My accountant who’s not used to this says I need a 1099Rfrom the UKbut because I don’t need to file taxes there I can’t get anything.
The IRS don’t take ‘international tax enquiries’ by phone.
Finally how would it be declared on my tax return,
I had no idea I had to declare pension income, either state or private and have also been receiving 2 x $600 (approx) for 14 years (since I've been here !!
Thank you to anyone who can hopefully simplify this for me.
To make things even more complicated, I was laid off inNovember and am currently fighting an unemployment claim
Dec 31st 2017, 3:14 pm
#1447
Just Joined
Joined: Dec 2017
Posts: 8
Re: UK state pension and USA social security
May I please verify something?
I am 68 and deferring both US Soc Sec (for which I have >40 Qtr credits) and UK pension. The UK in event of deferral offers "extra state pension".
Alternatively, you can get the regular uninflated state pension plus a lump sum. They will even agree to pay this lump sum to you in a later tax year after the monthly payments have started (if you request it)!
I just wanted to verify whether this lump sum is taken account of in the Windfall Elimination Provisions. I think I read somewhere that it is, I just wanted to check. If so, I probably won't bother with it and will take just the enhanced monthly payments.
Many thanks
I am 68 and deferring both US Soc Sec (for which I have >40 Qtr credits) and UK pension. The UK in event of deferral offers "extra state pension".
Alternatively, you can get the regular uninflated state pension plus a lump sum. They will even agree to pay this lump sum to you in a later tax year after the monthly payments have started (if you request it)! I just wanted to verify whether this lump sum is taken account of in the Windfall Elimination Provisions. I think I read somewhere that it is, I just wanted to check. If so, I probably won't bother with it and will take just the enhanced monthly payments.
Many thanks
Dec 31st 2017, 6:49 pm
#1448
Joined: Apr 2005
Location: Milwaukie, Oregon
Posts: 9,965
Re: UK state pension and USA social security
Yes it is. One of the questions my wife was asked about her UK pensions was if she had received, or would receive any lump sums.
Dec 31st 2017, 6:51 pm
#1449
Joined: Apr 2005
Location: Milwaukie, Oregon
Posts: 9,965
Re: UK state pension and USA social security
I think that under the US-UK treaty periodic pension payments are taxed depending on the physical presence during the calendar year of the recipient. So if you are resident in the US, you are taxable in the US ONLY on US Soc Sec payments, UK state pensions etc. I don't know how you would deal with any tax withholdings made from the UK state pension.
Dec 31st 2017, 8:00 pm
#1450
Lost in BE Cyberspace
Joined: Jul 2016
Posts: 10,005
Dec 31st 2017, 8:27 pm
#1451
Joined: Apr 2005
Location: Milwaukie, Oregon
Posts: 9,965
Re: UK state pension and USA social security
No, the same rules apply under the tax treaty about where pensions are taxed either way.
Not sure, hopefully someone living in the UK in receipt of a 401k will confirm what happens with those.
On 401k withdrawals ?
Dec 31st 2017, 8:43 pm
#1452
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Posts: 8
Re: UK state pension and USA social security
I am UK resident and have US IRA. It was originally in a 401K. I have taken distributions from the IRA several times. Since the amounts taken are not "periodic payments" (meaning that they are equal amounts spread over my estimated life-span), I have been told they are taxable in the US, not the UK. My tax adviser says that the IRS would say that, rather than being "periodic payments" they are "lump sums", hence taxable in the US, not the UK. If "periodic payments", they would be taxable in the UK under the treaty. The provider offers me a choice as to what US tax withholding (if any) I want to make. It seems there is no obligation to me to make any withholding, though that may not apply to people resident elsewhere than the UK. I have someone do me a US return at the end of the calendar year and make payment to the IRS. I imagine the same applies to a 401K.
Dec 31st 2017, 9:23 pm
#1453
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Joined: Aug 2013
Location: Eee Bah Gum
Posts: 4,127
Re: UK state pension and USA social security
I am UK resident and have US IRA. It was originally in a 401K. I have taken distributions from the IRA several times. Since the amounts taken are not "periodic payments" (meaning that they are equal amounts spread over my estimated life-span), I have been told they are taxable in the US, not the UK. My tax adviser says that the IRS would say that, rather than being "periodic payments" they are "lump sums", hence taxable in the US, not the UK. If "periodic payments", they would be taxable in the UK under the treaty. The provider offers me a choice as to what US tax withholding (if any) I want to make. It seems there is no obligation to me to make any withholding, though that may not apply to people resident elsewhere than the UK. I have someone do me a US return at the end of the calendar year and make payment to the IRS. I imagine the same applies to a 401K.
Jan 1st 2018, 6:10 am
#1454
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Joined: Dec 2017
Posts: 8
Re: UK state pension and USA social security
I am in a similar position, dual UK/US citizen living in UK. My IRA is with Vanguard and Vanguard had me complete and send in a W9 so that they do not automatically withhold US taxes when I make withdrawals. I have made a lump sum withdrawal from my IRA, converting it to my Roth IRA and only US taxes are due.
Foreign persons are subject to U.S. tax at a 30% rate on income they receive from U.S. sources. The Form W-8BEN is used to claim an exemption (or lower withholding amount) if there is an Income Tax Treaty negotiated with the US and another country (which is the case with the UK). You have to declare your UK tax ID (being your National Insurance #).
I don't know about the W9 - that seems to have something to do with businesses (??).
Jan 1st 2018, 7:44 am
#1455
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Re: UK state pension and USA social security
An important omission on my part: since I am UK resident and to avoid withholding in US, I have had to complete an IRS W-8BEN form. This lasts for several years.
Foreign persons are subject to U.S. tax at a 30% rate on income they receive from U.S. sources. The Form W-8BEN is used to claim an exemption (or lower withholding amount) if there is an Income Tax Treaty negotiated with the US and another country (which is the case with the UK). You have to declare your UK tax ID (being your National Insurance #).
I don't know about the W9 - that seems to have something to do with businesses (??).
Foreign persons are subject to U.S. tax at a 30% rate on income they receive from U.S. sources. The Form W-8BEN is used to claim an exemption (or lower withholding amount) if there is an Income Tax Treaty negotiated with the US and another country (which is the case with the UK). You have to declare your UK tax ID (being your National Insurance #).
I don't know about the W9 - that seems to have something to do with businesses (??).
For us USCs our foreign pensions are fully taxed by the IRS which for my wife and I means our 2 UK private pensions and our OAP.
