Income Tax (Earnings and Pensions) Act 2003 section 613

Taxable pension income: foreign annuities

Section 613 sets out how to calculate the taxable pension income for certain employment-related annuities that arise from a source outside the United Kingdom.

• The section applies to foreign-sourced annuities falling within sections 609, 610 or 611 — that is, dependants' annuities, annuities under non-registered occupational pension schemes, and annuities in recognition of another person's services.
• The taxable pension income for a tax year is the full amount of the annuity arising in that year, subject to the treatment of the annuity as relevant foreign income.
• Because the annuity is treated as relevant foreign income, the remittance basis rules and the deductions and reliefs provisions in Chapters 2 and 3 of Part 8 of ITTOIA 2005 may apply, potentially reducing the taxable amount.
• A special rule applies to annuities arising in the Republic of Ireland: the annual payments deduction rules under section 839 of ITTOIA 2005 apply in a simplified form, with certain conditions disapplied.