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HMRC internal manual

International Manual

DT Agreements: Japan - Income from a UK source paid to a resident of Japan

Claims by Japanese pension funds

What you do with a first claim by a Japanese pension fund

You need to determine which type of pension fund it is, so that you can decide whatrelief may be available.

The Double Taxation Technical Advice group have experience and records of the differenttypes of pension funds, and so you should consult the group about any first claim beforeproceeding.

But if it is still not possible to discern the nature of the fund from the information tohand, you will need to ask the claimant or agent to let you know its precise status inJapan.

Employees pension funds

An employees pension fund is generally set up by a company for the benefit of itsemployees. It can usually be recognised by its title, for example ‘The Honda PensionFund’.

But if the company name is that of a bank or other finance house,rather than a self-evident manufacturer or other evident direct employer, you shouldensure that you are not dealing with some form of .But you should also consider that you may be dealing with the bank or finance house’sown employees pension fund.

Once its status has been established, an employees pension fund can be treated as astandard pension fund (INTM336000).

So the fund can claim relief under the interest and dividends articles of the doubletaxation convention, and also under UK domestic legislation, for example the FOTRAregulations (INTM368000).

Tax qualified pension funds

Where the nature of the fund is not apparent from its title, and you have had to makeenquiries to help you to decide its status, you may learn that it is a tax qualifiedpension fund.

Once its status has been established, a tax qualified pension fund can be treated as astandard pension fund (INTM336000).

So the fund can claim relief under the interest and dividends articles of the doubletaxation convention, and also under UK domestic legislation, for example the FOTRAregulations (INTM368000).

Pooled pension funds

A pooled pension fund is usually managed by a trust bank and contains bulk investmentson behalf of a large number of separate pension funds. The separate funds have pooledtheir investments, hence the title.

You will often recognise a pooled pension fund by its title, for example ‘Sumitomopension fund number 3’.

A pooled pension fund can claim under the interest and dividends articles of the doubletaxation convention, but cannot normally claim under UK domestic legislation such as theFOTRA regulations.

Claims under the double taxation convention are considered on a basis similar to thatunder which claims under article 28A are processed (INTM355150).The trust bank manager of the pension fund is regarded as claiming on behalf of thebeneficial owners of the income of the fund who would be able to claim themselves underthe interest and dividends articles.

You should refer any requests for relief under the FOTRA regulations for pooled pensionfunds to the Double Taxation Technical Advice group.