UK Pension Buyout

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vfillafan

Registered User
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I have just received a letter from a previous employer in the UK saying that I may be receiving a offer of a cash lump sum in the forthcoming months.

This is a small pension as I only worked for the company for 2 years in the early 2000,s.

I understand that the fund is currently worth around 11,000 GBP and on retirement in 2022 I would be entitled to a pension of 802.79 GBP.

Obviously I do not know what the offer will be yet but would a lump sum if taken be taxable as I live in Ireland but the pension resides in the UK. Would there be a tax liablity in both UK and Ireland?

Any advice would be greatly appreciated.
 
As far as I am aware, the lump sum is not taxable in Ireland. There is a double taxation agreement between the UK & Ireland, so you would not be liable to taxation in both countries. I don't work in tax though so cannot say what the mechanics on paying tax would be.



Steven
www.bluewaterfp.ie
 
vfillafan;
Can,t see you being hit twice for tax.

On State UK pension;
If you worked in Uk you can buy-back state pension contributions.
If you only worked 2 years in Uk it is probably no good , but worth checking.
As they say , every little counts.
 
Thanks for the replies.

I suppose the question is do I qualify for tax credits even though I don't live in the UK now? If yes, would the credits cover the pension buyout?

As regards state pension contributions I worked in the UK for 29 years and believe I need 30 years to qualify for a full UK pension. So I could probably buy the extra years contributions...

I read somewhere on the web that if I have not lived in the UK for the past five years then the payment attracts no tax???
 
Gerry Canning said:
vfillafan;

If you only worked 2 years in Uk it is probably no good , but worth checking.
Click to expand...

My wife has only 2 years pension contributions in UK. She has been notified in writing by HMRC that she can buy back a max of 6 years in arrears and then can contribute every year until she reaches retirement. She has already started buying back.
 
hiya, as with everything, how you are taxed and the benefits are dependant on how you go about taking the money.
If There is a tax free sum, it will be tax free in ireland, but the balance will need to be declared as an income and taxed accordingly, but if moved from the uk only taxed in ireland, dependant on overall income.
cautious is correct, even a little time spent in the uk can be very advantageous to you, especially if you take advantage of the buying back years. If allowed, it is a must...
If you want to contact directly, i can go through with you in more detail, especially as may be available to you from age 50, even if still working...
 
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