Income Tax (Earnings and Pensions) Act 2003 section 654

The Pensions (India, Pakistan and Burma) Act 1955

Section 654 provides an income tax exemption for certain pensions paid under the Pensions (India, Pakistan and Burma) Act 1955, subject to meeting the foreign residence condition.

• Pensions paid under the authority of the Pensions (India, Pakistan and Burma) Act 1955 are exempt from income tax, provided the recipient meets the foreign residence condition.
• A pension qualifies if it is paid under the 1955 Act operating as a scheme under section 2 of the Overseas Pensions Act 1973, or under a scheme the Secretary of State has made and certified as corresponding to the 1955 Act provision.
• The exemption does not extend to any part of the pension that is paid as a result of the Pensions (Increase) Acts — these increases have always been paid by the UK government and taxed as UK pensions.
• The Pensions (Increase) Acts means the Pensions (Increase) Act 1971 and any later Act passed for corresponding purposes.