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Investment and moving to Cyprus

phildraper

If you are tax resident in Cyprus you need to register for a TIN. Then submit self assessments in Cyprus each year irrespective of any tax liability. Your UK state pension will not have tax to pay in Cyprus. You should have a notice of coding from HMRC of NTX. The P85 should have triggered that.  If you have interest bearing investments/savings this is also free from tax in Cyprus. Company dividends also are non taxable. If you have not been submitting SA's in Cyprus in the past but were a tax resident then they might ask some questions! Look into the new 10 year rule the UK are introducing regarding domicile. Apparently if you are outside the UK for 10+ years your domicile will not be the UK and this has some interesting change to your IHT and other tax. Advice at the moment is to get everything out of the UK ASAP to avoid devastating IHT. Make sure you nominate beneficiaries on any UK pension, policies etc.

AND as everyone has already mentioned get professional advise! The rules are changing all the time and the professionals should be up to date. In the long run it might save you significant tax and we do not like to pay tax lol

Peter Ty

There seems to be a lot of confusion about this!

All "government" pensions, e.g. civil service, local government, NHS, Armed Forces, etc. will be liable to  UK tax, but the State Pension, despite its name, is technically NOT a pension, it's a social security benefit and so it CAN be paid free of UK tax if you are tax-resident in another country. (And you can, if you want, have it remitted in Euros: they use the Citibank exchange rate which is actually quite good.)

Toon

@Peter Ty

Yeah tax clearance always causes significant delays on selling

Toon

As Peter says government paid pensions, civil servants council NHS workers firemen policemen Armed forces  excluding state pensions must be taxed in UK .. there is no escaping that

telf

@timhuntington As the SP falls below the tax threshold currently of £12570 no tax is paid


All government pensions are from Jan 25 taxed at source

timhuntington

Thanks very much guys for all your input.

Well I need to get my benifits  over here then tax free!

Phil, I do have a tin and the page says there's no outstanding documents but need to look into this more.

info265

Dear Tim,

Your case should be examined as we need to understand your current status in Cyprus, your status in the UK and the amount of the pension

If you have tax residency in Cyprus you can apply for the non-domicile status and use the exemption and flat tax rate of 5%

Cyprus has DTA with the UK, so the income tax can be minimize according to the DTA

Toon

Best advice see a good tax professional... Who is conversant with both UK and Cyprus taxation

gwynj

@lshill


If you reach State Pension age on or after 6 April 2016, your State Pension will increase every week you defer, as long as you defer for at least 9 weeks. Your State Pension increases by the equivalent of 1% for every 9 weeks you defer. This works out as just under 5.8% for every 52 weeks. The extra amount is paid with your regular State Pension payment.
Example: You get £230.25 a week (the full new State Pension). By deferring for 52 weeks, you’ll get an extra £13.35 a week (5.8% of £230.25).

telf

State Pension  £11,973 invested in say a cash ISA at 5 % = tax free £598.65 in the first year



Deferred additional £13.35 x 52 = £694.2 pre tax (average 20% basic rate tax payer £138.84) £555.36


You would take 20 years to recoup the initial loss of £11973   (Marginal increase in the long term but very few collect pension in their 90s )