Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Annuity annoyance

08 November 2006
Issue: 4083 / Categories: Forum & Feedback

A husband and wife, both non-resident, each have retirement annuities. Their total UK incomes are such that the provisions of FA 1995, s 128 apply and the tax each year on the retirement annuities is restricted to the tax deducted at source, currently 22%. With PAYE being applied to retirement annuities from next 5 April, what codes should be operated next year?

A husband and wife both non-resident each have retirement annuities. Their total UK incomes are such that the provisions of FA 1995 s 128 apply and the tax each year on the retirement annuities is restricted to the tax deducted at source currently 22%. With PAYE being applied to retirement annuities from next 5 April what codes should be operated next year?
HMRC have confirmed ('Retirement Annuities paid to Non-Residents — FAQs — 23') that retirement annuities remain excluded income for FA 1995 s 128 purposes. Logic suggests that the codes should be BR so that tax continues to be deducted at basic rate (22%) thus maintaining the status quo. But could an 'NT' code be requested so that tax deducted is nil meaning that under the provisions of s 128 no further tax is due? This result would be similar to...

Only subscribers may read the full article

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
back to top icon