Changes to tax treatment of foreign pension regimes
13 December 2016
As announced at Autumn Statement 2016, the government will legislate in Finance Bill 2017 and introduce regulations to align the tax treatment of foreign pensions more closely with the UK’s domestic pension tax regime.
Changes will take place from 6 APril 2017 and include:
- bringing foreign pensions and lump sums fully into tax for UK residents, to the same extent as domestic pensions and lump sums
- closing specialist pension schemes for those employed abroad (section 615 schemes) to new saving
- extending from 5 to 10 tax years the UK’s taxing rights over recently emigrated non-UK residents’ foreign lump sum payments from funds that have had UK tax relief
- aligning the tax treatment of funds transferred between registered pension schemes
- updating the eligibility criteria for foreign schemes to qualify as overseas pensions schemes for tax purposes.
If you have any questions about the changes, contact details are at the end of the TIIN.