RetireJapan

My wife is in the process of buying an annuity from her UK pension and is looking into an open market option.

After using a quote comparison tool, she called some of the suggested annuity providers, like L&G, Canada Life, etc. only to be told that they don't provide annuities to non-UK residents.

She'd been warned by the PensionWise advisor that some providers might not sell to people resident overseas, but this seems like all the major providers.

Have others with UK pensions experienced this and did you use another route, like a broker?

torata

Off the top of my head...

If your wife doesn't need the income straight away, she may be able to let it ride and delay taking the pension to any time up to the age of 75, when she must take the pension.

There is independent advice from MoneyHelper.or.uk, +44-800-011-3797
and their PensionWise service MoneyHelper.or.uk/pensionwise, +44-800-280-8880
(Edit: I now see you mentioned PensionWise...)

If you are unable to find an Annuity Provider, will the Pension Provider allow you to take the entire payout as a lump-Sum? The Tax on Retirement Lump-Sum in Japan is very advantageous.

This is taxed entirely separately from any annual income, so is completely stand-alone and not related to other income in the same tax year.
If you haven't availed yourself of the allowance before, You get the full Special Deduction of Y400,000 per year for the first 20 Years and Y700,000 per year over 20 years of membership.
Taxable Income = (Retirement Lump Sum - Special Deduction) / 2
Taxed at the Standard Marginal Income Tax Rates on the remaining half of the Retirement Lump Sum after the Special Deduction...

Income Tax Rates 総所得金額の合計、復興特別所得税、住民税の税率
Band (Taxable Income) - Marginal Tax rate (％) National + Reconstruction + Residents' Taxes = Total - Max National & Residents' Taxes in Band Yen
Under 1,949,000 - 5% + 0.105% + 10% = 15.105% = Y97,705 + Y195,000
1,950,000 to 3,299,000 - 10% + 0.21% 10% = 20.21% = Y135,284 + Y135,000
3,300,000 to 6,949,000 - 20% + 0.42% 10% = 30.42% = Y731,553 + Y365,000
6,950,000 to 8,999,000 - 23% + 0.483% 10% = 33.483% = Y472,490 + Y205,000
9,000,000 to 17,999,000 - 33% + 0.693% 10% = 43.693% = Y982,158 + Y900,000
18,000,000 to 39,999,000 - 40% + 0.84% 10% = 50.84% = Y8,818,480 + Y2,200,000
Over 40,000,000 - 45% + 0.945% 10% = 55.945% No Limit...

So, actually the tax rate is really low, or may even be tax free...

The net amount after tax then becomes the Tax Basis for the future.

Then feed the funds into NISA, this year, Y1.2M, next year Y2.4M and Y1.2M Tsumitate, and the next year, and so on... Keep some in cash and put the rest in a Tokutei Account, invest and withdraw gradually, paying Capital Gains Tax on the gain above the Tax Basis on the withdrawals from the Tokutei Account... No Capital Gains Tax is due on Withdrawals from the NISA in the future.

And, either invest in Dividend Paying Funds, or withdraw a little every month or year...

torata wrote: ↑Tue Jul 11, 2023 11:05 pm My wife is in the process of buying an annuity from her UK pension and is looking into an open market option.

After using a quote comparison tool, she called some of the suggested annuity providers, like L&G, Canada Life, etc. only to be told that they don't provide annuities to non-UK residents.

She'd been warned by the PensionWise advisor that some providers might not sell to people resident overseas, but this seems like all the major providers.

Have others with UK pensions experienced this and did you use another route, like a broker?

torata

Are you under any obligation to buy an annuity? They still don't offer great deals even with higher UK inflation now.

Wales4rugbyWC19 wrote: ↑Wed Jul 12, 2023 12:37 pm

torata wrote: ↑Tue Jul 11, 2023 11:05 pm My wife is in the process of buying an annuity from her UK pension and is looking into an open market option.

After using a quote comparison tool, she called some of the suggested annuity providers, like L&G, Canada Life, etc. only to be told that they don't provide annuities to non-UK residents.

She'd been warned by the PensionWise advisor that some providers might not sell to people resident overseas, but this seems like all the major providers.

Have others with UK pensions experienced this and did you use another route, like a broker?

torata

Are you under any obligation to buy an annuity? They still don't offer great deals even with higher UK inflation now.

Thank you both. That's useful info on the Tax on Retirement Lump-Sum in Japan.

No there's no obligation, Wales4Rugby, but it's what she wants to do with her UK pension pot.

So the question is have others been in this situation where annuity providers are not offering products to overseas residents, and did they find a way round it, e.g. a broker, or provider that does?