UK Belgium Tax treaty

Sorry should have said my Belgian pension started May 2012

Hi GwenShack,

If your pension started prior to 1 January 2013 then is will be subject to UK tax only.

If your pension began on or after this date, then it will be subject to Belgian tax only.

Thank you. 

I worked in Belgium from 1977-82 paying tax there. I subsequently returned to the UK working here from 1985 until my retirement in 1999. I then received a Belgian state pension from 2004 which has always been taxed in the UK. Since 1982 I have never received any income of any sort, state pension apart, from Belgium. In November 2020 I received a request for a tax return for, I think, my global income (in Flemish so not so sure). This I returned to them with a cover letter stating I was not obliged to do so or pay tax because of the double taxation treaty. All went quiet until April 2021 when I received another missive, again in Flemish, requesting tax on my belgian pension. I see from the forum that there appears to be a stand off - HMRC position is tax only in UK for pre 2013 pensions. Belgian position is that this is not now the case. What should I do?

In response to an e-mail to the Finance Ministry I received the following from one of their "experts"..... Dear Mr. Down, Because your Belgian pension was paid to you for the first time before 2013, you do not need to file a tax return. Normally you should no longer receive tax return forms from the Belgian tax authorities in the future. I hope to provide you with sufficient information. Met vriendelijke groeten, Nancy Vernackt Financieel deskundige Some good news . No tax returns or Belgian tax to pay on my pre 2013 state pension.

Hi Suquie Hart,

Can you please forward a copy of this letter to us at HMRC, PAYE and Self Assessment, BX9 1AS so we can also take this further?

Thank you. 

I actually sent you copies of letters yesterday evening so you should have it today. I really appreciate you taking this up on my behalf. Re the letter I received from the tax people in Belgium at the end of April they have given me the opportunity of disputing what they are saying and I will be doing that and sending them the form disputing it tomorrow.

Hi Brian Down,

If you have any paperwork or email from the Begian authorities, can you please send this to us and we can then take this further for you.

Our address is

HMRC,
PAYE and Self Assessment,
BX9 1AS. 

Thank you.

FAO: HMRC Admin 20 Hi Admin, I think it's sorted thanks. In the copy of their e-mail that I posted yesterday they said no more tax returns since mine was a state pension paid before 2013. In a subsequent confirmatory e-mail they confirmed that this meant no liability to pay tax in Belgium and that I should continue paying tax in the UK only! Regards, Brian Down

Brian Down… That’s interesting that you had an email from the Belgian Finance Ministry confirming that you don’t need to pay Belgian tax on your pre-2013 pension and that you shouldn’t receive a tax return in the future. This seems to be at odds with correspondence received by some of the contributors to this thread, some of whom have already had tax deducted from their pre-2013 Belgian pensions since January 2021. (Perhaps there has been a change of heart…) Most of my emails to the Belgian Tax authorities remain unanswered, apart from one response which stated that: “Pursuant to article 18b of the Belgian-British Double Taxation Agreement, Belgian pensions are all taxable in Belgium, regardless of whether they were paid for the first time before or after 01.01.2013.” I have not yet had any reply to the letter I sent back with Mum’s completed tax return and Certificate of Residence (UK), setting out why she should be exempt from Belgian Tax. I don’t think that she has had tax deducted yet from her Belgian pension as the amounts paid in 2021 are similar to those paid in 2020. Interestingly, I have just found this document via the ‘International Documents’ section on the FPS Finance website. https://www.senate.be/www/webdriver?MItabObj=pdf&MIcolObj=pdf&MInamObj=pdfid&MItypeObj=application/pdf&MIvalObj=83887326 This is a Bill, submitted to the Belgian Senate in 2011, approving the First Protocol for amendment of the 1987 UK-Belgian DTA. It provides an analysis of the technical provisions of the Protocol. The following excerpt is from page 11 of the document, under ARTICLE XI: Pensions (translation): “The text of Article 18 (Pensions) of the Agreement has been replaced. Pursuant to the new Article 18, pensions and other similar remuneration (including non-periodic payments) arising from a Contracting State are, in principle, exclusively taxable in that State. In accordance with the intention of the Belgian and British negotiators of the Protocol, pensions and other similar remuneration derive from a Contracting State when such income is paid by that State itself, one of its political subdivisions or local authorities or by a resident of that State (including a pension scheme, defined in Article 3 of the Convention, which is established in that State). With the exception of public pensions referred to in Article 19 (Public service), paragraph 1 covers all pensions and other similar remuneration, including those which are not paid in respect of previous employment (for example, self-employed workers' pensions or a life annuity that the beneficiary would have built up directly from capital accumulated outside a work-related pension scheme). The taxation of pensions and other similar remuneration is thus modified. At present, pensions and other similar remuneration are taxable exclusively in the beneficiary's state of residence either by virtue of article 18 or by virtue of article 22 (Other income). To avoid modifying the tax regime of persons who retired before the entry into force of this Protocol, pensions and similar remuneration paid to such persons shall continue to be taxed in their State of residence.” Thus it seems to me that it was ALWAYS the intention of the negotiators that people who were receiving their pension (including State pensions) before the 2009 protocol came in to force (1 Jan 2013 in Belgium) should NOT have to change the way they pay tax following its introduction. For these pensioners, all pensions and similar remunerations (other than Public Service pensions) should continue to be taxed in the recipient’s country of residence. For the Belgian tax authorities to claim that they had ‘misread’ the revised Treaty is quite mischievous. Granted, it is possible to change the meaning of a sentence with the addition or omission of a comma or two, but I think it unlikely that the protocol has been incorrectly applied for the past 8 years. The current taxation arrangements (as per HMRC guidance) are in line with the clear intentions of the negotiators set out in the Senate Bill, and I am sure that at least some of those who were responsible for implementing the revised Treaty at the time were also part of the negotiation process. Presumably Belgian residents who receive a pre-2013 state pension from the UK are treated in the same way by HMRC?

Brian Down and HiFi very interesting to read your posts. It doesn't seem to us that there has been any change of heart re Belgian state pensions in payment from before 1st January 2013. My father just received a lengthy email response yesterday (20/5/21) from SPF Finances (Expertise operationelle et Support Relations Internationales) in Brussels in response to his email of 16/5/21 clearly reiterating their revised interpretation that Belgian state pensions are not included in the section 3 definition, are therefore not covered by article 18(b) and therefore taxable in Belgium regardless of when payment started. There was no comment on our request for them to agree a common interpretation with HMRC, only that a recent exchange on this subject with HMRC had caused them to review their interpretation. We still await a response to our letter sent to HMRC on 10th March.

HiFi, all very interesting to read your comments. I too started my pension from before 1 January 2013. I am awaiting a reply from the Belgian Tax Authorities and also a reply from HMRC who promised to phone me back last Monday about this matter but no phone call as of yet. I too sent letters to the UK Tax HMRC about two week ago about this so await a reply to that as well. What happens if we are forced to fill in a tax form for the Belgians and charged tax. Can we reclaim the amount from the UK Tax authorities - no double taxation?????

I have had a Belgian state pension since 2014 and so are post the 2013 cut off. I have therefore incorrectly been paying UK tax since 2014. Like other people here I completed a Belgian 2019 tax form in November and I received a tax demand yesterday. Am I able to reclaim from HMRC for tax paid from 2014 onwards or can I only claim on a rolling basis as the Belgians back tax me? I also got a MAI/AMI deduction in January but that was refunded in February.

Suquie Hart - When mum received the Belgian tax return last November, I was very distressed and initially thought that it had been sent to her in error. I was assured by HMRC that tax was not payable in Belgium and that sending a Certificate of Residence for the year in question (2019) was the way to proceed. I did feel very isolated and it wasn’t until I found this Forum thread that it became apparent the issue was more widespread and that it had arisen because of Belgium’s unilateral ‘reinterpretation’ of the DTA. There is no way that my mother, now 88, could have dealt with all this on her own. I imagine everyone whose Belgian pension is affected by this is in their 70s now, with many in their 80s or even 90s. It has been an incredibly stressful and worrying episode for those affected and I think the action taken by the Belgians is cruel, unnecessary and against the spirit in which the Agreements were made. I don’t know what will happen if you don’t complete the Belgian tax return. They say you could be fined, but perhaps they wouldn’t do that whilst you were in discussions with them. For what it’s worth, in completing the Belgian tax return, I included Mum’s Belgian pension in Box XIII (Foreign and exempt Belgian source income) rather than Box VI (Pensions), so that it wasn’t recorded as taxable income. There was no option to enter the Belgian and UK pensions separately in that section, so I entered the total on the form then gave separate figures for her Belgian pension and her net UK pension income in the covering letter. HMRC say that if you believe you have been taxed in error, you should send them the correspondence and they will take up the case on your behalf. However, both countries are claiming the right to tax these pre-2013 Belgian state pensions so how are we supposed to know which country is in error? If tax is paid in both countries (and some people have already had tax deducted from their Belgian pension) potentially neither would give a refund. For whatever reason, the Admins on this forum seem unable to acknowledge that this is a widespread issue or provide reassurance that HMRC are working to resolve it. However well intentioned, there is little point in repeating the published guidance in increasingly simplistic terms. I think anyone who has read through this thread will be well aware of the official guidance by now, and it doesn’t really address the points that we have all been trying to make. Hopefully enough people will have sent in their relevant correspondence to HMRC for the authorities to recognise the extent of the problem. We don’t, as yet, have anything meaningful to send in, so I am still hoping that the position will soon be clarified publicly and on this Forum thread. Until then, it will be difficult to complete the 2020-21 UK tax return, as we can’t be sure these Belgian pensions (at least from Jan-April 2021) won’t be taxed twice.

LeHero. I would assume from the conversation I had yesterday with the tax technician at HMRC that if you are also declaring the pension in the UK then yes I think you can reclaim the amount but I am not a tax expert so you really should check this out by phoning the tax office.

HiFi I do agree with you. I am mid 70s and can still work out things but for those older people who cannot, this is a nightmare. And actually it worried me and I was relieved to find the forum and find I was not on my own. I actually typed out a document for my children yesterday headed (in case I lose my marbles) stating what has been said to me by the tax expert at HMRC! This is quite ridiculous. Two countries reading the same convention and interpreting it differently. I am now waiting for a reply from an email I sent to Belgian tax people and also a reply to a letter with copies of letters received from Belgium which I sent to HMRC. Luckily my tax form for 2019 Belgium is in french so I can understand it but one of my friends had the form in Dutch and in the end had to ask for an accountant in Belgium to fill it in for her which cost a lot and she has now heard that no tax is payable!!. And I also sent back to Belgium the form which the Belgians sent me which is saying that I do not agree with their interpretation of what should happen so while communication is going on I am not going to fill in the 2019 Belgian tax form for non residents. I have nevertheless looked at it and have worked out what I should fill in. Thank you very much for saying how you have filled in the form. I will have a look at that. I must say I only have a government pension, partly from the UK and partly from Belgium so my total income is not big. I spoke to a tax technician at HMRC yesterday and he clearly said firstly I should declare all on the UK tax form because my Belgian pension started before 1 January 2013 and secondly that if I had to fill in the form and was taxed by the Belgians then I could reclaim it from the UK HMRC. And because of this I intend to fill in the UK 2020-21 tax form with the Belgian amount. But I will probably not do this until August time thus giving the Belgians a chance to reply to my form which disagrees with their disagreement of what I was saying!!!. Please admin could you get the UK tax authorities to talk to the Belgians about this and come to some conclusion.

Re Belgian State pensions dating from before 2013. As I understand our situation, failure to complete a Belgian tax form could result in a fine. Furthermore, Belgium pays the pension and could deduct any outstanding fine or any tax due from that pension payment. If they do not have the relevant information (world-wide income, make up of household, spouse’s income), could they deduct tax at a default value equal to the top rate? What is the position? It is essential for us to be aware of the precise consequences of failing to comply with the obligatory Belgian procedure simply because we have been informed by HMRC that we should pay tax on this income to the UK and not to Belgium. The minefield this creates for those of us caught in the middle, is an unnecessary worry. I believe the tax currently being deducted by Belgium each month is only a provisional amount of tax, until they receive the necessary information requested on their tax return form. For the period Jan – March 2021, we shall not receive the corresponding Belgian tax form 2021 until 2022 followed by a demand for further payment (or perhaps a repayment) until sometime in 2023. Meanwhile we shall have already paid tax to the UK (2019-2020) on this Belgian Pension income by January 2022 at the latest. Maître Quaghebeur, in his post ± one month ago gave a clear statement of the Belgian position. It is worth rereading his submission. He asked “What is the position of HMRC? Has there been a negotiation with the Belgian Tax Authorities? “. We know the position of HMRC. Unfortunately, that involves us in potentially paying tax twice, plus the hassle of phoning and writing letters, perhaps being fined etc... Regarding the negotiation, some of us have been told of a recent exchange with the British Tax Authorities: “Cependant, après un échange récent à ce sujet avec l’Administration fiscal britannique, l’adminstration fiscal belge a dû revoir sa position.” I can only assume that in fact they really have been in contact about this problem since they have stated that to so many of us. It is now well over 2 months since I sent all the documentation to HMRC and I have heard nothing in response. It is unfortunate that the only signed letter telling me where to pay my tax on the Belgian State Pension (as from Jan 2021) has come from Belgium. HMRC has not written to me personally despite my writing to them. Had I not seen this forum, I would have assumed the system had simply changed after the “recent meeting” and therefore I would not have declared Jan-March 2021 Belgian Pension in the upcoming UK declaration. There must be some pensioners in this position. We understand Covid has made life difficult for everyone, everywhere, but please HMRC you really do need to act.

Suquie Hart - Yes you're right. It's been a great relief to find out you're not alone and to learn from the experience of others in the Forum. I'm sure (....hope...) that discussions are going in the background so I will probably also put this to one side for the time being until I either hear from the Belgian authorities or the position is clarified by HMRC. If there are any more developments from our side, I will post on this thread. I would also be really interested in updates from anyone else who is in a similar position. Many thanks to all for your help.

I have sent a letter to to the Belgian tax authorities stating that I have paid tax to the UK since the award of my pension in 2012 and therefore do not consider that I should now be required to declare my income to Belgium. I have accompanied my letter with documentation proving when my pension was awarded, extracts from the appropriate legislation and a certificate of residence from HMRC. I have no idea whether I will get a reply. All of this leaves me in limbo. I share the concerns expressed on the forum about the lack of information about whether negotiations are taking place between the two tax authorities. I wonder whether it is time for all of us to take this matter to our MPs?

Hi LeHero

Yes you can claim back the tax from the UK.

Please see the following guidance on amending previous years returns, noting however the time limit of how far back a claim can be made:
Self Assessment tax returns

Thank you.

PPG I think you are right, it is time to get MPs involved. I have tried my best to solve this problem and just feel I am going round in circles. After another sleepless night I will be writing to my MP this morning. Someone high up in the tax office ought to be resolving this problem, it is crazy that two countries are reading the same convention and are giving out different information. As I say, I have done my best to resolve this myself. I have an outstanding email and letter which the Belgians should reply to and I also sent relevant letters to the UK tax office about two weeks ago. I have spoken to some very informative people at the tax office who are very clear in what they say I should be doing, it's just not what the Belgians say.