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bigduckontax
bigduckontax, Accountant
Category: Tax
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UK taxation regime and Double Taxation Treaty rules on a

Customer Question

UK taxation regime and Double Taxation Treaty rules on a Swiss Vested Policy (pension)
JA: Have you talked to a tax professional about this?
Customer: no
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Customer: no
Submitted: 23 days ago.
Category: Tax
Customer: replied 23 days ago.
According to 1977 Switzerland/UK Double Taxation Treaty as amended by the 2009 protocol:Art.18, comma 1: Subject to the provisions of paragraph 2 of Article 19, pensions and other
similar remuneration paid to an individual who is a resident of a Contracting State, shall be
taxable only in that StateHowever Art. 18 comma 2 states:Notwithstanding the provisions of paragraph 1, a lump sum payment derived
from a pension scheme established in a Contracting State and beneficially owned by a
resident of the other Contracting State shall be taxable only in the first-mentioned State.This is my situation, I am in the process of withdrawing a lump sum from a Vested Benefit Policy. I'll be paying Swiss Tax on this amount. As far as I understand, I will not be required to pay any taxes in the UK. Could you please confirm? Also, do I need to submit a Self Assessment to the HMRC anyway? Thanks
Expert:  bigduckontax replied 23 days ago.

Only 25% of a liberated UK pension is tax free. You will have to rely on the Treaty for relief.

Customer: replied 23 days ago.
Thanks for your reply, much appreciated. This is not UK pension at all though, it's a Swiss one generated from my time working in Switzerland therefore I should rely entirely on the Treaty for tax guidance, shouldn't I?
Expert:  bigduckontax replied 23 days ago.

You would have to as you are subject to UK taxation on your world wide income.