Stand-out Q – funding pension from outside UK…

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SAT, 24 MAR 2018

Our Technical Hub provides access to a wide range of pension tax and trust technical resources. Every now and then we post tweets covering stand out questions from our technical content and our answers in case others might also find them helpful. As Twitter’s character restrictions only allow for the bare bones of the Q&A we link to the details here, too.

Question:

Individual moved to Kenya in September 2015. He has no relevant UK earnings, however his Kenyan employer wishes to make employer contributions to a registered pension scheme for him; is this possible?

Answer:

Membership of a registered pension scheme (subject to scheme rules) is open to anyone regardless of where they are resident or of where their employer is resident. There is no restriction on the amount that can be contributed by an overseas resident individual or by an employer in respect of them. However, relief from UK income tax may not be available, or may be restricted on such contributions in certain circumstances.

Overseas resident members of a registered pension scheme are subject to the annual and lifetime allowances and their associated charges – see https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm114000

However, the issue here may well be that providers are unwilling to let someone who is non-resident join a registered pension scheme. It would therefore be prudent to check with the chosen provider before confirming with the client that it is possible.

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