Earnings of employees and office holders: retirement benefits schemes from 6th April 2006 - overseas pension schemes: payments to pension schemes relieved from United Kingdom taxation under a double taxation agreement
Paragraph 7 of Part 6 of Schedule 3 to the Social Security (Contributions) Regulations2001 (as amended by regulation 8(6) of the Social Security (Contributions) (Amendment No.2) Regulations 2006)
An employer will be eligible for UK tax relief on a payment it makes to an overseaspension scheme if the conditions specified in a double taxation agreement(“DTA”) are met. Those conditions will depend on the wording of the DTA, butnormally will include the following:
- the individual was a member of the scheme before coming to work in the UK,
- the scheme is tax-recognised in the other country, and
- the UK accepts that the scheme corresponds to a UK tax-recognised pension scheme.
For Class 1 NICs purposes, a payment by an employer into an overseas pensionscheme which qualifies for tax relief under a DTA with the countries in thefollowing table is disregarded in the calculation of earnings.
|Country||Date from which payment can be disregarded (ie, the date on which the relevant legislative provision took effect)||Other guidance|
|France||6th April 1999||NIM02161|
|Republic of Ireland||||NIM02161|
|United States||6th April 2005||NIM02161|
|Canada||6th April 2006|
For the Class 1A NICs position, see NIM14510.
|Words in bold are defined in the Glossary to the Registered Pension Schemes Manual (RPSM20000000). They have the same meaning for NICs purposes unless otherwise stated.|