UK Work Pension coming up
Jan 20th 2016, 6:45 am
#31
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Joined: Aug 2013
Location: Eee Bah Gum
Posts: 4,186
Re: UK Work Pension coming up
If you say so. I've now reached the stage where by mid-morning it's not a question of remembering what I had for breakfast, but if I had breakfast. 
I imagine what you're referring to is Publication 939, the General Rule.
A USC, permanently resident in the UK, working in the UK, and paying towards an employers pension in the UK, may have declared their UK income gross on a US 1040 (declaring pension contributions for US tax). They may have also included the UK employers contributions. It's my understanding that this forms a partial basis in the pension (growth is the other part). I do certainly know of individuals who claim this basis to reduce the taxable amount of their UK pension via the General Rule. I await correction on my understanding.
It's yet to be established in this thread, but my impression is iceflow was not a US person at the time of contributing to the pension being discussed, and therefore not eligible for a 939 basis deduction.
I imagine what you're referring to is Publication 939, the General Rule.
A USC, permanently resident in the UK, working in the UK, and paying towards an employers pension in the UK, may have declared their UK income gross on a US 1040 (declaring pension contributions for US tax). They may have also included the UK employers contributions. It's my understanding that this forms a partial basis in the pension (growth is the other part). I do certainly know of individuals who claim this basis to reduce the taxable amount of their UK pension via the General Rule. I await correction on my understanding.
It's yet to be established in this thread, but my impression is iceflow was not a US person at the time of contributing to the pension being discussed, and therefore not eligible for a 939 basis deduction.
The fact that I also was not a USC during my UK pension contributions probably explains why I didn't follow up on your excellent info, and immediately forgot the details.
Jan 20th 2016, 9:28 am
#32
Forum Regular
Thread Starter
Joined: Sep 2013
Posts: 120
Re: UK Work Pension coming up
OK thanks folks, I appreciate the responses. I was not a GC or USC during my time contributing to my UK employers pension scheme.
So my plan is to enter the amount on line 1040 as per Durham Lad and hopefully will have made a reasonably accurate estimate on the W-4 additional withholding during the year.
Thanks
So my plan is to enter the amount on line 1040 as per Durham Lad and hopefully will have made a reasonably accurate estimate on the W-4 additional withholding during the year.
Thanks
Jan 20th 2016, 1:10 pm
#33
BE Forum Addict
Joined: Aug 2004
Posts: 4,754
Re: UK Work Pension coming up
I have made 28 years of voluntary Class 2 NICs using money that was taxed in the US. There will be no WEP from the UK state pension that I'll get from these contributions and I will have a US tax free basis as I've used already taxed money to pay for this "pension" benefit which is US taxable income. Using the general method I calculate 5% will be tax free........
Jan 22nd 2016, 9:20 am
#34
in Northern California
Joined: Apr 2014
Posts: 284
Re: UK Work Pension coming up
I will turn 65 in 2 years. I am already taking US Social Security. I worked in the UK for ~20 years paying regular NICs. After moving to the USA ~20 years ago I paid voluntary Class 2 NICs.
I had been operating under the assumption that WEP would apply when I start to receive the UK State Pension at age 65 (although I further understood that only half of it would be considered and not that resulting from my voluntary contributions).
If I am now completely off the hook for WEP, that would be welcome news!
I had been operating under the assumption that WEP would apply when I start to receive the UK State Pension at age 65 (although I further understood that only half of it would be considered and not that resulting from my voluntary contributions).
If I am now completely off the hook for WEP, that would be welcome news!
