Income Tax (Earnings and Pensions) Act 2003 section 651

Overseas Pensions Act 1973

Section 651 provides an income tax exemption for certain pensions paid under the Overseas Pensions Act 1973, subject to a foreign residence condition and excluding pension increases paid by the UK government.

• Pensions paid under section 1 of the Overseas Pensions Act 1973 are exempt from income tax provided the foreign residence condition is met.
• The exemption applies regardless of whether the pension is paid from a fund established under a scheme made under the Overseas Pensions Act 1973.
• Any part of the pension that is paid because the Pensions (Increase) Acts apply to it is not exempt and remains subject to income tax.
• The Pensions (Increase) Acts are defined as the Pensions (Increase) Act 1971 and any later Act passed for corresponding purposes.