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Posted Sat, 22 Apr 2023 11:14:44 GMT by leo22
Hi, I used to live in Japan for about 7 years, then moved to the UK. While living in Japan, I contributed to Japan National Pension which is similar to UK State pension. Because I only contributed to Japan National Pension for 7 years which is not enough to qualify to get pension when I reach pension age. So after moving out of Japan, I applied for pension refund which is something Japan Pension allows. A few months later I got the refund to my UK bank account. My question are because I applied and got the refund while being a UK tax resident: 1. is the refund considered as taxable? 2. if so, under which section/category should I declare the money under in my self-assessment? Thanks.
Posted Thu, 27 Apr 2023 15:04:37 GMT by HMRC Admin 5

The refund is not taxable but any interest or dividends that this then generates is taxable income.

Thank you.
Posted Thu, 27 Apr 2023 23:05:39 GMT by leo22
Hi, thanks for getting back to me. Could you elaborate why the refund is not taxable?
Posted Fri, 05 May 2023 09:34:35 GMT by HMRC Admin 25
Hi leo22,

It is not taxable as it is a refund on contributions that were deducted from income on which tax has already been paid.

Thank you. 
Posted Fri, 08 Sep 2023 22:10:03 GMT by NY2022
Hi HMRC Admin, As from the messages above, Japan Pension Lump-Sum Withdrawal is not taxable. Do I need to declare this in the Self-Assessment? Thank you very much!
Posted Mon, 18 Sep 2023 12:54:01 GMT by HMRC Admin 32

If it is not taxable in the UK and no tax has been deducted from it, then do not include in your Self Assessment Tax Return.

Thank you.
Posted Wed, 20 Sep 2023 22:17:50 GMT by cvj01
I would just like to clarify, because I am in a similar situation though my pension provider was a private company, not the Japanese government: - my pension contributions and my employer’s matching contributions were all taxed income while still in Japan - pension has grown in value during the years - I am told by the pension provider that cash out of pension value will follow taxation rules of the country where I receive it; that is, I won’t be taxed in Japan but I may have some tax liabilities in the UK. Would the growth of the pension pot be tax free? Or is it only the contributions that is tax free (because they have already been taxed)? For example, if £100,000 is the total of my personal and employer contributions and the pension total value is now £120,000, do I have to pay tax on the £20,000? Thank you!
Posted Tue, 26 Sep 2023 14:03:36 GMT by HMRC Admin 17

The pension pot in whole will be taxable when you eventually cash it in to take the money  .

Thank you.

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