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Posted Mon, 17 Oct 2022 17:39:06 GMT by irongeezer
DT4605 (Double Taxation Manual -Canada) states 'If a UK resident has paid Canadian tax on their Canadian pension or on the whole of their Canadian annuity, they should claim repayment of the whole of the tax (charged on a pension) or part of the tax (charged on an annuity).' I was unsure whether the claim of repayment of the Canadian tax on a Canadian pension paid to a UK resident referred to a repayment claim to the CRA (Canada Revenue Agency) or a claim on the UK tax return for repayment by way of a credit for the Canadian tax paid against the UK tax due. Can you clarify? Thanks.
Posted Fri, 21 Oct 2022 15:15:14 GMT by HMRC Admin 20
Hi irongeezer,

The double taxation agreements between the UK and a foreign country are reciprocal in nature.  
A UK resident in receipt of a canadian pension is taxable on that pension in the UK.  
If Canadian tax has been deducted from the pension, then the UK resident needs to claim a repayment of the tax deducted from the CRA.  
The Canadian double taxation agreement states at article 17(1) "Periodic pension payments arising in a Contracting State and paid to a resident of the other Contracting State who is the beneficial owner thereof shall be taxable only in that other State. ".  That other state in this case is the UK.

Thank you.

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