UK Tax on Australian Superannuation

I think you have misunderstood, it would merely be swapping the pension fund out of the managed fund and into property which would still be classed as pension in Australia. It would not be withdrawing the fund for personal use nor moving the proceeds to the uk

Hi Daiput

You have still withdrawn the fund in order to invest it in property, and as such this is still seen as a cash withdrawal of the fund irrespective of what you have done with it.

Thank you

So what if I switch from one fund manager to another? That same way the fund would be liquidated and reinvested but no cash benefit to me the same scenario

Hi, can you confirm that if I cash in my Australian Superannuation as a lump sum while living in Australia and then move to the UK a few months later, I will not be taxed on the amount by HMRC. Thanks

Hi,

This answer can have numerous outcomes. Article 17(1) advises that pensions including lump sums and annuities, are taxable only in the country you are a resident of.

UK/ Australia Double Taxation Convention

The elimination of double taxation at article 22(2), states that if you are taxable in the UK and have already paid tax in Australia, you can claim a credit for the tax paid in Australia against the UK tax

If you are tax resident in Australia, in the tax year that the pension lump sum is paid and not the UK, then it is taxable in australia.  
If you are tax resident in the UK, in the tax year that the pension lump sum is paid and not the UK, then it is taxable in the UK.
If you are tax resident in Australia and the UK, in the tax year that the pension lump sum is paid then you can claim a tax credit in the UK against the tax paid in Australia.

Thank you.

Please can somebody help me. I am 66 I live in the uk and am tax resident in uk I have an uncrystallised personal Australian superannuation account with one of the major Australian super funds. I contributed to this from my own money. There were no employer contributions. Looking at the very first post in this thread (4years ago). The reply from HMRC admin 3 states that there is “no uk tax on lump sum withdrawals.” Is this correct? Can I withdraw lump sums from my superannuation account free of uk tax ? If not, is 25% of lump sum withdrawals tax free ? and is there any tax reduction on the contributions? Many thanks in advance for your help

Hello, my father (Australian citizen and tax resident) has recently passed away and has named me (UK/Aus dual citizen and UK tax resident) as sole beneficiary of his death benefit from his pension fund. I have struggled to find information on how this is taxable (ie in Australia only, UK only or both) as this is a sole lump sum benefit, and it not on my personal pension. Is this considered pension under Article 17 of the tax treaty, or is it different as it is a lump sum? Where is this taxable? Also, I have been advised by his pension fund that a chunk of this amount is set up to be tax-free in Australia. Does that also apply on any tax applicable in UK? Thanks

Hi,
As UK resident you are liable on your worldwide income and the Australian superannuation would be taxable in the UK.
There is no reduction in the UK for the contributions made.
Thank you.

Hello HMRC Admin 8 Thank you for your response. I received a letter from HMRC about 4 years ago saying that 25% of lump sum withdrawals from my Australian superannuation fund would be free of tax but there would be no tax free cash on regular withdrawals. Is this still the case and is there any guidance on how to submit the correct numbers on this in self assessment return?

Hi Mcg1203 Mcguirk,
As UK tax resdient you would need to declare the income - Tax on foreign income.
Thank you.

Hi,
Please refer to:
Tax on foreign income
Thank you.

Hello HMRC admin 8 My enquiry is not about foreign income. It is about tax free cash from a single lump sum withdrawal from a pension fund. Is it possible for you or a colleague to answer the question about the 25% tax free cash on a lump sum withdrawal? If it’s not possible do you have the contact info for someone within HMRC who can provide clarity.

Hello, I have a question regarding uk tax on an Australian super fund pension lump sum withdrawals. If a Uk tax resident with dual Uk/Australian citizenship emigrates to live permanently in Australia on 1st May 2024 :- At what point (if any) would uk tax apply on withdrawals from an Australian superannuation fund after arrival in Australia.

Hi Carnoustie68,
If you are no longer a UK tax resident, you are not liable on any foreign income received after you leave the UK.
If you qualify for split year then you only report any foreign income for the UK part of the year:
RDRM12000 - Residence: The SRT: Split year treatment: Contents
If you do not qualify then you will need to report all your foreign income to the UK:
Tax on foreign income.
The guidance at:
RDRM12150 - Residence: The SRT: Split year treatment: Case 4: Starting to have a home in the UK only
Will help you work out if split year treatment applies. 
Thank you. 

 

  

 

 

Hi Carnoustie68,
Article 17 of the UK/Australia DTA states
"ARTICLE 17 Pensions and annuities.
1 Pensions (including government pensions) and annuities paid to a resident of a Contracting State shall be taxable only in that State. 
2 The term “annuity” means a stated sum payable periodically to an individual at stated times during life or during a specified or ascertinable period of time under an obligation to make the payments in return for adequate and full consideration in money or money’s worth.". 
Paragraph 2 specifies payments made 'periodially', qualify for relief. 
Lump sum payments are not mentioned in any way, therefor, they do not qualify for double taxation relief and so the lump sum is taxable in the United Kingdom. 
Thank you.
 

Many thanks HMRC admin 25 for your help

Hello HMRC, When we transfer our total funds from Australia to UK do we have to formally notify you and prove that the money is clean ie its not the proceeds of illegal activities but rather the funds from the sale of our house and the cashing out of our super funds. How far in advance do we have to notify you ? How do we notify you ?

Hi Bill Wood,
There is no requirement to notify HMRC of the transfer of capital assets from an overseas bank account to a UK bank account.
Thank you. 


 

Hello HMRC, When we move from AUstralia to UK do we have to apply for the split year tax status ? ie if we leave Australia on 19th July and arrive in UK on 20 July are we automatically splitting the year like this 6 April to 19 July All relevant taxes paid in AUstralia 19 July to 6 April following year All relevant taxes paid in UK or do we have to formally ask for the split year to be applied ? Where are the forms we might have to fill out to apply for the split year treatment please ? Thanks Bill

Hi Bill Wood,
No, pease read the guidance at RDR3
RDR3 Statutory Residence Test
And take the statutory residence tests.
If you are considered resident in the UK for the whole tax year, you will then need to consider whether split year treatment applies.
If split year treatment applies, you complete a Self Assessment tax return (SA100) and claim this on SA109.
You  would declare your world-wide income arising in the tax year after your arrive in the UK.
If you are tax resident for the whole tax and split year treatment does not apply, you declare your world-wide income for the whole tax year and claim a tax credit f or up to 100% of the foreign tax paid on your income.
Thank you.