Income tax on annuity where NO 25% lump sum taken

Hi I recently started receiving an annuity, a payment once per year. The annuity is based on me NOT taking my 25% lump sum. I assume that for income tax purposes I complete my Self Assessment form and state that the payment has not had any tax relief? I could have chosen to take a 25% tax-free sum, but chose to have a higher annuity. Thanks.

This is a new concept for me, so I don't know how long a reply will take. Just a quick "nudge" to see if anyone is there? Jeff

Hi,

That is correct, you will declare the gross amount you have received.

Thank you.

Thank you. Just to clarify things, if the annuity is (say) £10,000 Pa gross, I declare these facts and then get the 25% tax free allowance to take the taxable amount to £8,000. I will then be liable to income tax on £8,000. Does this appear correct?

Sorry, my mistake on the above post, the £8,000 should read £7,500. So again, my question is, because i haven't taken my 25% tax free allowance, do I pay income tax on the full £10,000 or £7,500? Thanks and sorry for the error.

Hi Jeff Holt,
The guidance here:
EIM75300 - The taxation of pension income: annuities chargeable to tax as pension income
Advises that UK annuities are subject to tax on the full amount of the annuity arising in the tax year.
The person liable to pay tax is the person receiving or entitled to receive the annuity.
This applies whether or not they are UK resident.
Annuities under non-registered occupational pension schemes are subject to PAYE.
Thank you. 
 

Hi HMRC, I've got multiple workplace pensions that I am trying to consolidate into one or two larger pension pots. If I want to use one of these to buy an annuity next year (when I start receiving my state pension) and assuming that I don't take the 25% tax free lump sum but invest 100% of my pension fund into an annuity; do I have to pay tax on the pension fund when I use that pension fund money to buy an annuity? I understand that I need to pay tax on the annual/monthly payments that the annuity provides once its setup - I just wanted to understand if I am required to pay tax twice (once to initially buy an annuity and then again on the regular payments that the annuity provides)?