UK tax free lump sum pension

[Jayroyal]

Hi, I have recently received lump sum tax free pension payment from a private UK pension and am wanting to know how this is treated for tax in Australia? Is it treated as worldwide income and fully taxed as so or do I only pay tax on the interest that the pension has accrued since I became an Australian permanent resident? All rather confusing and reading conflicting views online.

[Andrew from Vista Financial]

Hi there

Typically a lump sum payment from a foreign super fund (includes UK Pensions) is assessed for tax on the Applicable Fund Earnings (essentially growth element) between date of arrival and receipt of lump sum.

The above does not apply if the lump sum is received within six months of residency or if the individual is not a permanent resident or citizen of Australia.

See also:

https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/foreign-super-funds/withdraw-a-lump-sum-directly-from-a-foreign-super-fund 

Hope this helps.

Andy

 

 

Edited January 30 by Andrew from Vista Financial