Self Assessment for Overseas Annuity Payment

Hi, I am the policy holder of an overseas annuity plan provided by a bank in Hong Kong. The policy was set up and fully paid before I moved to the UK. Under the policy, I have paid an annual fixed sum to the bank for 5 years and the bank will payout a fixed monthly sum of money in Hong Kong dollars starting from the 6 to 15 years (120 months) of the policy to my Hong Kong bank account. In the last tax year, I started to received the monthly payouts. However, the bank does not provide the breakdown on the interest and the principal. I would like to ask the proper way to declare these monthly payment I received. 1.) Should I treat the payment as overseas interest in self-assessment (SA106) ? 2.) As there is no breakdown on the sum of interest, should I derive the amount of the interest earned by using the total fixed payments I will receive throughout the policy to subtract the total payment I paid to the bank; and then divide the sum by the number of months (120 months to be exact) to obtain the monthly interest earning for tax declaration purpose. Thank you!

Hi ,
 

Please refer to guidance at : HS321 Gains on foreign life insurance policies (2025)  .

Thank you .

Hi,
Please refer to guidance at HS321 Gains on foreign life insurance policies (2025)
Thank you.

I have read through the guidance. My policy is similar to a purchased life annuity on a fixed 15 years term. A fixed monthly payment will be paid by the bank (insurer) which consists of part of the principal and interest. According to the guidance, it is the interest part (gains) which should be taxed since there is no other chargable event so for. Since the bank is unable to provide the amount of interest, I would like to know whether the calculation method as mentioned above is acceptable for self assessment. Moreover, should I declared the information on an attachment to the SA106? Thank you!

Hi ,

yes to both .

 
Thank you .