Income Tax (Earnings and Pensions) Act 2003 section 616

Taxable pension income

Section 616 establishes how taxable pension income is calculated for certain overseas government pensions paid in the UK, using an accruals basis rather than a payments basis.

• Where section 615 applies, the taxable amount is the full pension accruing in the tax year
• The charge is based on amounts accruing from day to day, not on when payments are actually received
• The resulting figure feeds into the computation of net taxable pension income under section 567
• The actual date on which pension payments are made or received is irrelevant for the purposes of this calculation