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Hello Steve, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.
Firstly, when you left the UK in 2002 did you send a Form P85 to the Inland Revenue as it was then? If you did not then you should do so immediately, but now, of course, to HMRC. On receipt that Department will classify you as non resident. Once so classified you can spend up o 91 days in the UK in any one tax year without breaching that status.
Now for my questions; how old are you please? Have you been diagnosed with a terminal illness?
Well, it it is available now and you will find dealing with HMRC as an ex pat much easier if you use the P85 procedure. It would not matter if you duplicate the submission.
Even if you were non resident for tax purposes the rental of your UK property would still be liable to UK Income Tax, although as a citizen of the EEA you would be entitled to a personal allowance which you say would leave you with no tax to pay. However, you should have been making tax returns of this income each year unless the taxman told you not to bother which might happen as processing returns which yield no revenue is an exercise in financial futility. However, for the tax year in which you cashed in your pension, the man from the Pru would tax 75% of the lump sum at your marginal rate of taxation. To recover some of this over payment, if any, it will be necessary to make a self assessment tax return for the tax year in which you received your pension pot. If this was the current year then it is possible that your tax office will make some recompense part way through the tax year.
I do hope that I have shown you a way forward in this matter. You have to be over 55 or possibly have a terminal condition if under that age to take advantage of pension liberation.
Well a P85 will do no harm and a self assessment form will clarify the position for HMRC for the relevant year. Alternatively you could use a Form R85 to recover the overpaid tax, but a self assessment form will do just as well.
Please be so kind as to rate me before you leave the Just Answer site, Steve.
Thank you for your excellent support.
Correction to my last post. In line two I should have said R40 not a R85!