Filling return of Old Age Living Allowance from Hong Kong Government

Hi, team, can you please help on the questions of filling the Old Age Living Allowance (OALA) from the Hong Kong Government? OALA is the Social Security Allowance scheme to provide monthly allowance to Hong Kong elderly people aged 65 or above who are in need of financial support. My questions 1) which category in Form SA 106, should I filling the OALA? 'Overseas pensions, social security benefits and royalties" under "Foreign" page? 2) Would this income be taxed in the UK? it seems that under Article 17 of Double Taxation Treaty, this is not taxed in the UK. is this correct? Thanks

Hi,

Please have a look at article 17 of the UK / Hong Kong tax treaty, which you can see here:

2010 Hong Kong-UK DTA

It advises that social security pensions arising in Hong Kong, are only taxable in Hong Kong. In the interest of full disclosure, you can add a short comment in the free hand box declaring this non taxable pension per article 17.

Thank you.

Hi, further to above reply. May I clarify that, if someone is receiving the OALA from Hong Kong (which is only taxable in Hong Kong) while no other income, does s/he require to file the Self Assessment Tax Return ? Thank you.

Hi,
If you were to follow self assessment legislation to the letter, then yes, a tax return would be required every year, as the individual is required to declare t
heir world-wide income, which would include non UK taxable income.  
This income would be included in the freehand box, so that it is not included in any tax calculations.
Thank you.