Since the UK left the EU there has been in-depth coverage and speculation regarding the implications of Brexit and the Trade Agreement on businesses but what about pensions and personal taxes?

UK State Pension

If you moved to the EU before or by 31 December 2020

If you were living in an EU country by 31 December 2020, you are covered by the EU Withdrawal Agreement. This means that you will continue to receive your UK State Pension, provided that you have paid enough UK National insurance contributions to qualify, and it will increase in line with rates in the UK.

UK State Pension (if you move to the EU after 31 December 2020

You can carry on receiving your UK State Pension if you move to live in the EU, EEA or Switzerland and you can still claim your UK State Pension from these countries if you have paid enough UK National insurance contributions to qualify. It will also be increased each year in the EU in line with the rate paid in the UK.

You can choose to be paid every four of 13 weeks. If your UK State Pension is under £5 per week, you will be paid once a year in December.

You can apply for a UK State Pension forecast here: https://www.gov.uk/check-state-pension 

Paying tax

How much tax you will pay and where you pay it depends on where you are considered to be a resident. 

UK residents 

You may have to pay UK tax on your UK State Pension if you live abroad but are classed as a UK resident for tax purposes. The amount of tax you pay depends on your income. 

Overseas residents 

You may be taxed on your UK State Pension by the UK and the country where you live. If you pay tax twice, you can usually claim tax relief to get all of some of the double tax back. If the country you live in has a double taxation agreement with the UK, you will only pay tax on your pension income once. This may be to the UK or the country where you live, depending on that country’s tax agreement. 

We can review your tax residence status and advise on the UK tax implications of receiving your UK State Pension.