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Posted Fri, 17 May 2024 14:33:57 GMT by SunnyUK
I was born in Denmark as a Danish citizen, and whilst working there paid in to a workplace pension scheme known in Denmark as "kapitalpension". Payments to this scheme was income tax deductible. The scheme matures after I turn 60 years and pays out as a lump sum. The Danish tax authorities will withhold 40% of this lump sum. I have been resident in the UK since 1999 and have paid tax in the UK since 1999. The contributions to my Danish "kapitalpension" stopped in 1998. I am a naturalised UK citizen. I'm hoping that double taxation rules means that when this pension matures, I won't have to pay UK tax on it in addition to the 40% withheld by the Danish tax authorities. But is that correct? And how should I declare it on my self assessment?
Posted Wed, 22 May 2024 12:24:13 GMT by HMRC Admin 19 Response
HI,

Please refer to Article 18 of the double taxation treaty here:

UK/Denmark Double Taxation Convention

Thank you.
Posted Wed, 22 May 2024 14:36:47 GMT by SunnyUK
Hi, I did try to make sense of that article before posting my query, and I am afraid I still don't understand it now that I have re-read it. As I read it, Article 18 says (in relation to my specific situation) 1) Pensions (or similar) paid to me, being resident in the UK, is subject to tax ONLY in the UK 2) In my case, where I was resident in Denmark and have become resident in the UK, nothing in this Article shall affect Denmark's right to tax me on pensions (or similar) 3) talks about social security legislation so not sure if it is relevant for a workplace (private) pension. But if para 3 is relevant, it says notwithstanding para 1, payments received by me being resident in the UK under social security legislation in Denmark, shall be taxable only in Denmark 4) defines what "annuity" means Article 19, para 2 is also referenced in Article 18 para 1. Article 19 para 2 says (translated to my case) 2) (a) Any pension paid by our out of funds created by Denmark shall only be taxable in Denmark 2) (b) however, such pension shall be taxable only in the UK if the I am resident and national of UK [which I am] So Article 18 seems to say 1) only taxable in the UK 2) but also in Denmark 3) but only in Denmark and Article 19, if it applies, says 1) only taxable in Denmark 2) however, only taxable in the UK I'm utterly confused....
Posted Fri, 24 May 2024 16:46:20 GMT by HMRC Admin 25 Response
Hi SunnyUK,
As we can only provide general information / guidance in this forum and not repspnd to specific or hypothetical scenarios
For an answer to a detailed question of this nature, you would need to contact our Self Assessment helpline
Self Assessment: general enquiries
Or seek professional advice. 
Thank you. 

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