UK income tax

[jackvern]

We still Own Property in the UK which we rent. We still have all UK,pensions paid into UK,banks and therefore continue to pay all UK income taxes and have self assessment yearly. Have now lived in this beautiful island for 14'years and am not a burden on UK National Health system which We paid into for years. We derive no benefit from our motherland yet still contribute to the tax system.. I ask myself why but my wife argues that perhaps one day we may need it. I have no intention of returning and consider Cyprus my home. Now my question is how many Brits here continue to have pensions paid into UK banks and draw out sterling as opposed to those who have them paid into Cypriot banks and therefore pay no UK tax. I understand that UK tax authorities may be wise to this and things may change. Would just like general opinions no in depth pontification and am very wary of tax consultants. Thank you.

[Tojo]

That's interesting, are you saying that if you have your UK pension paid into a trnc account you do not pay UK income tax. I have a government pension, which is paid into my UK bank, would that mean if I changed to have it paid direct into my trnc account, I would not pay UK tax?

[waddo]

Tojo. No. Like mine and my wife's, your UK Government pension is taxed at source - that is before we can get our sticky hands on it to have it put in whatever bank we choose. There is no way around it I am afraid and I have tried hard to find one. Government pensions always look glossy at first glance but the reality is totally different in the end. If you have not already reached that magical roundabout age of State Pension then when you get that it is supposed to be tax free. They get around that statement by saying that the first £xxx of your income is the State Pension and it is tax free because your personal allowance covers that. That means that any other pension, Government or otherwise is taxed even more than before to the tune of whatever amount your State Pension is.

jackvern, All our Government Pensions are paid into a UK account and we draw Sterling from the ATM here. Did consider opening a Turkish (Not TRNC) bank account and having them transferred direct but the exchange rates involved were always to the benefit of the UK Government. Having given them 43 years of my life I opted to keep the pittance left after they taxed my pensions - lol. Like yourself this is our home and we will not return BUT it looks like we will all end up paying more income tax to prop up a failing NHS to the benefit of all those people in the UK - how wonderful!

[ljarvo]

Do you do your tax return via an accountant - if so and you visit England less than 30 days a year you should be able to apply for a NT (No Tax) tax code.

If you are not going back to UK worth looking into this.

[sophie]

I think a whole lot of us might be looking into the NT tax code business. Like waddo we have no intention of going back to UK but our pensions Government and Private are taxed at source and like waddo, after 44 years of contributions to NI still pay for an that black hole of an ailing NHS which my husband and I were virtually thrown out of, roads we don't drive on, state schools that very few of my family have attended, and immigrants I hopefully will never meet, we still pay heavily into the UK. I don't go into the UK more that 30 days in 3 years!!

[waddo]

Sophie, Already looked into that idea, failed! The problem is you can apply for NT but then you pay income tax to the country that you live in. Whilst that is no big thing, in reality you can not do that unless you are A) A citizen (which you can't get unless the Government change things again) or B) Have a work permit and pay social sigorta! The trick is that Northern Cyprus does not exist and therefore HMRC can't help us. If we lived in Turkey - no problem. If we lived in RoC again no problem as both countries have a double taxation agreement with the UK - we don't exist so we don't have an agreement! If you have read any of the latest news on these agreements you will note that the UK is starting to change the agreements so that it is to their advantage and that is going to cost a lot of people who live in the RoC a lot more in tax than they do at present. Guess that is just another fall out from Brexit - why should the UK lose all that lovely income tax to an EU country - lol. I have not been into the UK for the past 3481 days so I would qualify if we existed - lol.

[sophie]

Oh well, its my birthday, the sun is shining, the dogs just lazing about, the breakfast grapefruit cocktail awaits, cards to open so guess we'll keep on, carrying on and pay up as before. Thanks waddo for the info.

[waddo]

Happy Birthday - wishing you lots more of them and less income tax in the future!

[jackvern]

Thanks for the explanation Waddo. Looks like we will continue supporting the UK tax system. If I ever had a reason to return to Blighty I wonder if this explanation would allow me access to the NHS again or Would I be treated as a foreigner and have to pay.

[waddo]

Welllll, as an ex serviceman and under the terms of the Military Covenant, last year I asked that same question of the GP I had in the UK before I left. His answer was slightly less than non comital in that he said "We would have to see what happens at the time", very useful I thought!! I would expect to be treated as a non resident/alien and be forced to pay, but you never know - lol.

[Nosey]

Sorry but as for paying into the uk system for brits (I use th term loosely) can benefit who do you think is actually contributing to pay for your pension ?

[waddo]

Nosey, Good question? Which pension? The one I worked for 25 years for in the Military, the one I worked for 17 years for in the Civil Service or the Tax Free one called the State Pension that I luckily received when I was 65 but which my wife will not receive till she is 66? Yes it is a very fair system is it not - even my wife gets a Government Pension for the 23 years she served in the Military and of course should I die before her she will receive half of my Military Pension - just to keep things straight on the equality front if she were to die before me then I will receive half of her military pension, but only half of her last seven years of service as the first 15 years of her service she was not equal! So all that pension money is lost - wonder where that goes?

But if you are asking about the State Pension only then who contributes to mine - nobody now because that scheme was set up so that the majority of contributions for my pension were actually contributed by my parents and the pittance part of my Income Tax that I pay is my contribution to the next generations State Pensions. Personally, as I am forced to pay National Insurance to a country I have not lived in for over 11 years and to which I have no intention of ever returning, I would like to see all of my National Insurance contributions paid directly into the State Pensions pot but apparently that is too difficult for HMRC to work out as they can not even tell me where my NI contributions go to!

Hope that answers your question but if not please elaborate and I will do my best to answer you.

[tomsteel]

Top answer waddo. Reflects much of our personal circumstances, albeit the numbers are different. We paid into the 'accepted and legal' system operating for Service, Civil Service and State Pensions. We contributed, as did those before us and those who will follow us. My wife also contributed to her State Pension to be arbitrarily denied it by an age of birth ruling. How many MPs have been denied theirs?

[jackvern]

Waddo you are on fire but very up to date. We are in exactly the same position as you and Tomsteel.,half my service pension will transfer to my wife and I will receive a proportion of her private employment pension. What happens to the state pension is respect of spouses. I ask this because a few years ago a dear friend of ours passed away aged 64 years. Just a few months from receiving his first OAP pension payment As he had never received his pension his wife was not entitled to receive any of his pension contributions. Is this still the case if you don't make the age then all is lost.

[waddo]

jackvern, Sorry no answer for you because to be honest I plan on going first - lol. Well, I am 8 years older and the one with the dodgy ticker so my chances of outliving the boss are a bit slim really. Sorry to all that I upset by that statement but service people tend to say things the way they are without the required sugar (sorry, that has been banned as well), without the PC interference!

We have never looked into it as I made it to pension age 6 years ago and the way the wonderful UK Government is going we don't think my wife of coming up to 64 will ever get hers - the goalposts just keep on changing! We are not even sure what will happen to mine when I snuff it but expect it to go on for a year and then stop. Difficult to put a finger on it but I will search about and see what I can find buried in the HMRC web sites.


I could also add this, but I won’t - lol.

[Nosey]

Well wasn’t quite expecting quite a passionate response . But let’s remember you did not pay tax on the Pension initially (yes would have been better to pay then but on way or another they will get you ) so alas we have to pay now