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  • RE: UK Belgium Tax treaty

    Posted 15 days ago by HMRC Admin 2 Hi, Pensions paid after 2013 would be subject to tax only in Belgium and would therefore not be reportable to the UK. ================================================= Oh THANK YOU, THANK YOU, HMRCAdmin2 That is such fantastic news that I shall not have to do a UK tax return. You have made my life so much easier. I am thrilled to bits!
  • RE: UK Belgium Tax treaty

    Also to add. The big problem for people who have income from more than one country is the rate of exchange issue. It is very hard to plan, as you never know which way the exchange rates will go. I have only been receiving my small Belgian pension for the last 6 months and one month really stood out for a fluctuation in the wrong way..... and that was an oddity on the rate of exchange for that particular day when something must have happened in the markets. I hardly dare think how small my pension might be in the future! If I last that long! (And now inflation is biting....let's not go there.)
  • RE: UK Belgium Tax treaty

    Good morning John. I shall not know what I am being taxed until next year when I do the tax return. I have to admit, John, your 27.5% is also the type of tax rate that I am expecting. (Do they add a certain amount for commune tax?) Some other countries have also decided to tax pension income where it arises for non-residents, through their treaties. In the Belgian case, I did wonder if they decided to do this, because Belgium has had so many foreign workers in the past. (International Organisations). And they would all be taking the Belgian state pension away with them when they retire. So perhaps they need to get more taxation support to maintain their funding or something. Here is a link I found, I do not think it is HMRC that decides the treaty, it is some form of government body. https://www.gov.uk/guidance/uk-treaties#practice-and-procedures-for-new-treaties The very perplexing thing about this, is that it only seems to have come to light quite long after that protocol came into effect.... that Belgian returns were not being done correctly due to a misunderstanding on the wording of what a plan is! And to make it even worse, having discovered the mistake late, they then all decide and agree to go back and allow the re-opening of old Belgian returns (if that is what they are doing.) Another odd thing really, is that if we had had a deduction for the Belgian social security contributions from our wages when we earned them, then it would make more sense to claw back the tax when we retire,
  • RE: UK Belgium Tax treaty

    Justme47 I also did notice this... "federal standard personal allowances and federal tax credits, only applies for taxpayers that have at least 75% of their worldwide income taxable in Belgium..... and that is also applicable to non-residents," I have just started receiving the Belgian state pension. I shall not be doing my first Belgian tax return until next year, so I do not yet know for sure how they will tax me. Might this be another reason they could look at the level of all our pension income and be asking for it. Could it be that if we do not have 75% of all our pension income taxable in Belgium (paid from Belgium), then we do not get any allowance taken off??
  • RE: UK Belgium Tax treaty

    "Justme47 said,,,,,,,I wanted to add that on the Belgian tax return, I have included both my UK and Belgian incomes. It seems unfair as I already complete a Self Assessment here in England, declaring all UK and foreign incomes. So I will be taxed twice, against the Double taxation taxation treaty." What I think happens here Justme47, is that they use ALL the income JUST (ONLY) to get the tax brackets to apply on the Belgian income. So they do not actually tax your UK source income. You enter that UK source income on the NON TAXABLE pension line in the other section so that it will not actually be taxed in Belgium. Here is a simplified example for you using dummy tax rates to give you the idea of how it works.... Belgian Pension say 2000 euros / UK Private pension say 20,000 euros / UK state pension say 8000 euros. The total pension income is 30,000 euros and they look at the TAX RATE PERCENTAGE that would apply on that level of income. Let us say that it is 25 per cent. Then I will be taxed in Belgium at 25 percent X the 2000 euros = 500 euros. (If they did not do it that way.....say the tax bracket in Belgium on just 2000 euros is only 5 percent tax rate at that low income level.... they would have only taxed me at 5 percent of 2000 = 100 euros.) So can you see that by considering all my UK pension income to get to the TAX RATE....... BUT NOT ACTUALLY TAXING my UK income.....they ARE actually pushing my Belgian state pension income up into a higher tax rate and they claim more Belgian tax from me on it! That makes them very happy. I hope that makes sense.