Does the United States have an income tax treaty with the UK?
The United States has an income tax treaty with the United Kingdom (the Treaty). Article 17 (1) of the Treaty provides that: a) Pensions and other similar remuneration beneficially owned by a resident of a Contracting State shall be taxable only in that State.
Is a lump-sum payment from a pension scheme taxable?
Article 17 (2) of the Treaty provides that: Notwithstanding the provisions of paragraph 1 of this Article, 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. GENIN-111967-08 2
Can a foreign pension plan be a tax treaty?
While the United States generally taxes its residents on their worldwide income regardless of their citizenship or the source of the income, an income tax treaty to which the United States is a party could modify the usual rules and mitigate some of the disadvantages of participating in a foreign pension plan.
Is pension income taxed in the UK or the USA?
And this is contrary to the tax agreement between the UK and the USA, which states pension income is to be taxed in one State only, and in the case of lump sum payments it is the USA. Is this correct? Am I due a tax refund? Thank you.