lansbury

As when you are interviewed for your SS application you are asked to state that all answers are correct, and it is fully explained that you commit perjury if you knowingly give a false answer. One of the questions my wife was asked was if she received any pension(s) from the UK.

Therefore your suggestion not to say anything is about one of the most crass and stupid comments I have seen on BE. It is inciting others to commit a criminal act.

Disenchanted

Can you clarify that for me please? Are you saying your spousal pension is 50% of your wife's SS pension amount, after WEP reduction has been applied?
If that is so and you had had a US Gov Pension, your 50% would then also be subject to GPO, which would be in effect a double reduction for you.

I believe the spousal pension is not subject to WEP, only subject to GPO, hence the question about "any other pension from the US".

Nutmegger

The only minefield would be created by giving a bald-faced lie. Bad, bad advice.

lansbury

My wife claimed her SS at 65. The amount was worked out and she was told what her pension would be, after deduction of the WEP. They then spoke with me. They again worked out my wife's pension after deduction of WEP, but this time what it would have been if she had taken the full amount at age 66. I will receive 50% of that amount. I was hoping to receive, at best, 50% of her actual pension. My pension is 50% of the amount my wife would have received at 66, after her pension was subject to the WEP.



They confirmed a spouse pension is itself not subject to the WEP. The GPO only applies to a government pension which is sourced within the USA.

UK2US1979

Talked with a Pension officer in UK about the taxation aspect of weekly pension as well as a deferred one time lump sum. They told me that no tax deduction is made from the wekly pension and no tax will be decucted from the lump sum either. So, she said, I need not file 2002 or certificate of residency, to that matter. While the one time lump sum plus 1 month pension is just under the UK annual allowance, if i take into account the weekly pension to next April, added to the lump sum, it would slightly go over the UK annual alowance. So, I feel I still need to obtain further clarification on this. May be in writing. Any thoughts Lansbury, nun or any others?

lansbury

I've been sitting here thinking about this for about 15 minutes. If the UK pension office say they will not deduct tax from either weekly pension or lump sum, then I think it safe to assume they will not do so.

If HM tax man subsequently discovers that you have received over your personal allowance they might write and ask for the unpaid tax. Then you can either dispute you are liable to UK income tax as you live in the US, or pay it and tax a foreign tax deduction on your US tax return.

nun

Double check with HMRC that your tax code is NT, if it is there should be no need to do anything else. HMRC don't withhold tax from the state pension....they leave that up to UK private pension providers. You might also write on your state pension international application that because you are a US resident you are claiming exemption form UK tax on your pension under Article 17.3 of the US/UK double taxation treaty.

nun

The IRS would not have to give you credit for any UK tax you pay on the UK state pension.....

lansbury

Thanks nun, something else I've learned.

nun

Strictly speaking the treaty gives the US the sole taxation authority over UK state pensions paid to US residents. However, the IRS might give you credit if you filed a 1116 even though they don't have to if they apply the treaty.

UK2US1979

<...Double check with HMRC that your tax code is NT...> This is what I mentioned to her ( and she is the Pension officer at DWP). She was adamant that I dont even have to do it. She also commented that I file the US taxes any way. Further, she kept saying if HMRC have not ever contacted you since leaving the UK about any tax liability or the need for filing the US residency forms etc, then I don't even have to contact them! She did say, the pension etc is under the annual allowance any way. Well, the amount of the first monthly payment of the basic pension plus the one time deferral Lump sum sure would be under the annual allowance. However, if you take into account the UK state pension up until the next April, coupled with the lump sum, the total will somewhat exceed the annual allowance. At this time, she did not have the exact amount of the lump sum in front of her even though I mentioned the previous estimate they gave me. I guess, after I receive the revised figures by way of a letter in the next 10 days, I shall try to speak to them again. If needed, I rather file the forms now rather than HMRC asking for any taxes later. Lump sum amount in cases where taxable is taxed at the highest tax rate.

<HMRC don't withhold tax from the state pension....they leave that up to UK private pension providers..> I dont have a UK private Pension.

UK2US1979

<...If HM tax man subsequently discovers that you have received over your personal allowance they might write and ask for the unpaid tax. Then you can either dispute you are liable to UK income tax as you live in the US..> If the Pension is paid by the DWP, how would HM tax man even know what the pension amounts were. Don't think the DWP shares or have to share the information on pensions with HMRC???
In any event, as you say, If HMRC ever questioned it, I shall take the position that I am a US resident and file US taxes.

theOAP

For residents in the UK:

The DWP does in fact send HMRC the exact amounts paid each year. When completing a self-assessment form, and if you use the actual amount of State Pension received during the year (an error since you're paid 4 weeks in arrears), HMRC will correct the amount to the DWP amount. Tax is calculated, if applicable, using the DWP amount. This can be confirmed in the letter sent you by HMRC showing how they calculated your tax.

The DWP send a letter to you each year, prior to 6 April, stating what your next years State Pension will be, but may not include lump sum distributions for delayed pension entitlement. This is the basis of what you file on the self-assessment form for the following tax year.

Is notification by DWP to HMRC different for those resident abroad?

UK2US1979

The Pension officer at DWP, amongst other things, also said that after they process the claim, they will send me a document/form (I think she said it had a number beginning with something like 1 BR......) that she said I should take it to the SSA office for WEP purposes. She said it was different from the Award letter. I forgot to ask her in what respect it differed from the Award letter because this too, to my knowledge, contained all the pension info. When I mentioned the WEP Form 308 that we are required to file with the SSA here, she didn't seem to know what it was! Did anyone who have lately received the UK state Pension, get any such document/form in addition to the Award letter? Also, those who are going to be receiving state pension ( Lansbury for his wife), please share the information if they do receive any such document. I prefer to keep it simple and file just the form 308.

lansbury

We didn't receive anything from the UK to give to social security. I would not expect most staff a the DWP to know anything about WEP and the forms here. When we did our SS claim the other day we were not asked to submit a form 308. The guy dealing with our claim was happy to accept the information verbally, with just the usual statement by us that the information was true and to give false information was perjury.

The SSA staff member we spoke to didn't know what the UK State pension was and we had to explain that to him. I think he was confused by the use of State in the name, having a different meaning to State in the USA. Having said that we found the whole process of claiming SS very easy and straightforward, and the guy we dealt very professional and helpful.