US pension and UK Tax

Are regular distributions from the US government Thrift Savings Plan taxable in the UK?

Hi mark bartram,
If you qualify for split year, then you only report any foreign income for the UK part of the year. You can see guidance here:
RDRM12000 - Residence: The SRT: Split year treatment
If you do not qualify then you will need to report all your foreign income to the UK. Please see the following guidance:
Tax on foreign income
The guidance below will help you work out if split year treatment applies.  
RDRM12150 - Residence: The SRT: Split year treatment: Case 4: Starting to have a home in the UK only
Thank you.
 

Hi ,
 

It is only for actual paid out pensions prior to that date . Thank you  .

Hi TonyD ALD,
There is no legislative definition of a Lump Sum but HMRC regards these as being any non-periodic payment of a pension -
That is, any non-regular payment that decreases the value of the remaining pension pot after such payment is made.
For example, the first (IRA) withdrawal is taken in year 1, the next withdrawal was made in year 5, and another withdrawal in year 7;
such payments will not be regarded as periodic and will be treated as Lump Sum’s under the UK/USA DTA.
Whereas any amount withdrawn in set, periodic, frequent intervals (e.g. weekly, monthly, annually etc.) would not be a Lump Sum, but rather periodic payments. 
Thank you.

Hi Anne Drysdale,
Periodic, frequent, payments or withdrawals (e.g. weekly, monthly, annually etc.) payments are taxable within the UK and ‘maybe’ exempt from US tax.
This is in accordance with Article 17(1)(a) of the DTA.
Thank you.

Hi Admin20, I appreciate your reply but I had already read HMRC's definition of Lump Sum and I was seeking further clarification for my situation ie. ad hoc withdrawals each year, where I initiate each withdrawal with respect to date and amount, not regular pre-arranged payments. I think these are multiple lump sums but I don't know if that is correct. Please see my previous post also. Thank you.

Hi
This forum is for general queries only and is intended to help you self-serve. We are unable to provide specific advice tailored to individual circumstances. 
 

In common with several posting here, I am a UK citizen with a 403B fund arising from employment in the US. However I differ because I do not need a lump sum, and can explore more tax efficient options… My proposal is to Draw down my 403B pension pot through periodic payments, taking the entire amount over a few years. I would aim to set the level of payment to minimise any tax. I understand that in the UK, such pension payments count as income, so I would need to look at my annual allowances. My questions are, one) is it possible to take the entire 403B fund in this way, and two) what would be my tax liability in the US? Many thanks for any help you can offer…

Please can you confirm my understanding, based on previous posts and answers here: A US Individual Retirement Account (IRA) is NOT recognized as a pension account by HMRC, but an employer-sponsored 401-K retirement account IS recognized as a pension account by HMRC? Also, do I understand correctly that withdrawals from an IRA, regardless of whether they are periodic or lump sums will simply be treated as income by HMRC? Is it possible to transfer a lump sum from an IRA into a UK private pension scheme without incurring UK tax? Do you know how the US would treat such a withdrawal from an IRA for a US citizen?

Hi doctor-sparks,
This will be treated the same as 401k pensions.  
Payments made by the individual into an IRA, are made after tax relief is given to the individual by the employer.  
Payments from this pension are taxable in the USA.  
HMRC do not recognise IRA schemes as pensions, so for UK residents, they are taxed as income under the interest and declared as foreign interest on a tax return (SA106).  
There is no US taxation if the pension is subject and liable to UK tax.
If US tax is withheld, then the individual,  should seek a refund of this tax (file a form 1040NR).  
HMRC will not give a credit for this tax against any UK tax charged on this income.    

Payments made into a Roth IRA are made before tax relief is given. As a result, payments from this account are not taxable in the USA.  
HMRC recognises this account as a pension scheme and as it is not taxable in the USA, it is not taxable in the UK either.
Thank you. 

Hi,
Payments made by the individual into an IRA, are made after tax relief is given to the individual by the employer.  
Payments from this pension are taxable in the USA.  
HMRC do not recognise IRA schemes as pensions, so for UK residents, they are taxed as income under the interest and declared as foreign interest on a tax return (SA106).    
There is no US taxation if the pension is subject and liable to UK tax.
If US tax is withheld, then the individual,  should seek a refund of this tax (file a form 1040NR).  
HMRC will not give a credit for this tax against any UK tax charged on this income.   
Payments made into a Roth IRA are made before tax relief is given.  As a result, payments from this account are not taxable in the USA.  HMRC recognises this account as a pension scheme and as it is not taxable in the USA, it is not taxable in the UK either, 
Thankyou.