UK pension living in Japan

[beanhead]

Thank you bean head, its stating my phone is not compatible for this app.
WTF, it's a 2018 Samsung Galaxy S8, not a Nokia 3100.

Mmmm...sorry, can't help much there. Maybe the version of Android on your phone is just a bit too old.
Can you use another family phone just for this authentication purpose?

[AlanJH]

Maybe I could try my wifes phone, it's a fairly recent model, so maybe worth a go.
Thank you

[novalis]

Hi, could I just jump into this UK pension-related topic with a question?

Is the UK state pension regarded as taxable income in Japan and is it necessary to declare it? Many thanks!

[Tkydon]

Hi, could I just jump into this UK pension-related topic with a question?

Is the UK state pension regarded as taxable income in Japan and is it necessary to declare it? Many thanks!

Yes.

It is a Public Pension, and so your total combined Public Pensions (UK and Japanese Public Pensions combined) are eligible for the Public Pension Deduction, in addition to your other allowances ad deductions.

See Page 8 (page 12 of the PDF) here:

https://www.tax.metro.tokyo.lg.jp/book/ ... k2023e.pdf

Bottom of Page 22 and top of Page 23 here:

https://www.nta.go.jp/taxes/shiraberu/s ... df/050.pdf

And under the Japan UK Tax Treaty Article 17, is Only taxable in Japan.

http://www.mof.go.jp/tax_policy/summary ... n-UKEN.pdf

"Article 17
Subject to the provisions of paragraph 2 of Article 18 of this Convention, pensions and other similar remuneration beneficially owned by a resident of a Contracting State shall be taxable only in that Contracting State."

No US Saving Clause...

You just need to double check with the HMRC to make sure you receive your UK Pension gross.

[TunaSki]

Hi, could I just jump into this UK pension-related topic with a question?

Is the UK state pension regarded as taxable income in Japan and is it necessary to declare it? Many thanks!

Yes, it is taxable in Japan. And yes, you need to declare it (even if it gets paid into a UK bank account)

It’s taxed as pension income in Japan. And you will want to file this form to HMRC to utilize the tax treaty agreement to exempt you from tax on it UK side https://www.gov.uk/government/publicati ... japan-1-dt

And like wise, if you reside in UK, and claim your Japanese pension you will want to file this form to NTA, to utilize the tax treaty, so that Japan don’t apply non-resident tax to it: https://www.nta.go.jp/english/taxes/wit ... /13001.htm

[ichii]

Claiming a UK private pension in Japan is taxed differently from the public pension? If so, perhaps as "self assessed income tax on individual income"? So up to 1,950,000jpy, at 5%, and from there to 3,300,000 at 10%, and so on?

[Bubblegun]

This has brought up a few questions in my mind.

I assume the taxable event will be "when the money is brought over to Japan?"
I assume it will be calculated on the "exchange rate" on the transfer day?

Is it better to do one massive lump transfer or a monthly transfer? I would assume one massive transfer is easier for tax purposes if exchange rates have to be taken into account.

Is there any way to lower our tax liabilities? Please note. This is not tax avoidance but being tax efficient.

[TunaSki]

Claiming a UK private pension in Japan is taxed differently from the public pension? If so, perhaps as "self assessed income tax on individual income"? So up to 1,950,000jpy, at 5%, and from there to 3,300,000 at 10%, and so on?

I think annuities from UK government backed private pension schemes such as SIPP and workplace pensions are taxable as as pension income.

[captainspoke]

...
I assume the taxable event will be "when the money is brought over to Japan?"
...

I'd think it would be the date paid (received), and it would not matter that it stayed in the original currency that it was paid in, whether (when) it was transferred here, etc. This would be similar to when I receive dividends or interest in a foreign account. (Tho if you leave it in a foreign currency, you'd technically need to then account for exchange rate changes from the date paid to the time you then change it into yen.)

And pension payments will be regular--not sure about UK, but likely monthly? That would be easy come tax time, a simple spreadsheet with twelve rows (for each payment), and columns for date, payer, amount, TTM rate on that date, and those multiplied so you get the yen equivalent in the final column, with the total at the bottom.

Something like this--leave off the foreign tax columns, use 'pension payment' instead of dividends, use pounds instead of dollars, and replace ticker with the formal name of the UK pension service.

https://imgur.com/5KHc0a4

[TunaSki]

This has brought up a few questions in my mind.

I assume the taxable event will be "when the money is brought over to Japan?"

The taxable event occurs when the money is transferred from your pension provider to you.

So if you get it paid into a UK bank account the pension income taxable event occurs the moment it enters your UK bank account. You then need to log the £>¥ exchange rate for that day, to work out that taxable’s JPY value at the point in time the taxable event occurred for you Japanese tax return.