# Pension payments



## ziggydax (Jun 6, 2012)

Any help appreciated please guys.
Ref. Monthly civil service pension.
This will be paid to where I want but is it for me to have it taxed in the UK and sent in Euro to my Spanish bank, to have it paid into a UK bank then I have to do the currency transfer or something else?
I am guessing it doesn't get taxed in Spain instead of the UK as the tax would be less?
Thank you.


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## Maureen47 (Mar 27, 2014)

ziggydax said:


> Any help appreciated please guys.
> Ref. Monthly civil service pension.
> This will be paid to where I want but is it for me to have it taxed in the UK and sent in Euro to my Spanish bank, to have it paid into a UK bank then I have to do the currency transfer or something else?
> I am guessing it doesn't get taxed in Spain instead of the UK as the tax would be less?
> Thank you.


Some information in the link below on Civil Service Pensions and Spain and more in the FAQ's section of the forum 

Civil Service Pensions - Capita - Paying Your Pension Overseas


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## thrax (Nov 13, 2008)

You can have it paid directly into a Spanish bank account and you will get the exchange rate on the day of transfer with no charges. Government pensions are taxed in UK and not in Spain.


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## Dunpleecin (Dec 20, 2012)

Let me tell you something regarding this. I have a government pension and now have it paid into my Spanish bank. However, the pension payment, when it comes in, will not say "Pension" on it, or give any reference, it will only state "Transfer". Depending on what you require from your bank, this may not matter, but if you are wanting any kind of finance, for example, it is very very difficult to prove to the bank, or any other lender, that your "Transfer", is indeed your pension. Even with a full audit trail, complete with as much proof as any normal person would know to be conclusive, there will still be problems.

Also, in the same vein, because your pension originates from the UK, it might be that the banks do not recognise it as a proper income as such, only a monthly transfer.

The recent experience I have which is still ongoing was of obtaining an interest free deal for eye surgery and to cut a very long story short, as it's the subject of a formal complaint, if you are thinking of taking out any such finance deal, be prepared for problems. They will at first tell you that your pension has to be paid into a Spanish bank, but will then come up with all sorts of reasons not to conclude the deal.

I have to say that other than this issue I am currently having a problem with, it is much more convenient for me to have my pension paid into my Spanish bank, although I'm not sure the rate you get is as good as some may make out. I get just as good a rate with Currencies Direct as I do when I calculate when my pension comes over. Also there is a small fee bfrom the pension provider per month for doing it. Usually around 1 to 2 pounds.


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## thrax (Nov 13, 2008)

The rate I get is the actual rate at the time of transfer. for the Spanish tax system I use my HMRC documentation which is sufficient. I have never had a problem.


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## zenkarma (Feb 15, 2013)

ziggydax said:


> This will be paid to where I want but is it for me to have it taxed in the UK and sent in Euro to my Spanish bank, to have it paid into a UK bank then I have to do the currency transfer or something else?


Your best bet is to have it paid directly into your UK bank account (where it will be taxed) and then 'bulk' transferred 'as and when' using one of the specialist currency fx specialists. That way you should get the best transfer rates. If you have it transferred directly to your Spanish bank account each month you'll only get the exchange rate applicable at the time of transfer.


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## thrax (Nov 13, 2008)

And the exchange rate at the time of transfer will be the best at that time. Or you could leave it in your bank in the hope that the exchange rate will increase etc. My UK government pension is taxed at source as they all are. Very simple and nothing at all to worry about.


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## CapnBilly (Jun 7, 2011)

Except that with effect from 1st January 2015, ( so the tax return submitted in 2016), it will be taken into account when working out your marginal rate of tax on any income that is taxable in Spain, I.e interest, state pension etc.


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## Classified (May 9, 2010)

*Pension Changes 2015*

Recent News

TWO experts in their respective fields are touting big savings and gains out of a potentially toxic financial situation for UK expatriates.
UK government pensions will face major legislation changes from April 2015.
When the UK financial year begins on April 6, 2015, those receiving unfunded public sector pensions can no longer transfer them as a lump sum to a private account or fund.
It will affect government workers such as police, doctors, dentists, nurses, armed forces and firefighters with a pension fund.
Pension Transfers Direct managing director David Ford said transferring a pension was hugely beneficial.
“They can still receive their payments if they choose not to transfer before next April, though three reasons make it viable to transfer now,” he said.
“These reasons are what people expect for retirement: to save, control and preserve what they are entitled to.
“Savings would be made because benefits derived from lump sums transferred into Australian Super funds are not taxed.
“Control gives the recipient the power to do what they want with their money, not be told when and how it is paid.
“Preservation – they would receive the whole amount regardless of if they died, where only 50 per cent goes to their partner, or if both a recipient and their partner die the pension is absolved back to the government.”
That means any other family members, including children or grandchildren, are not entitled to anything if they are over the age of 18.
But he offered a stark warning to those thinking they have time on their side.
“It is not a quick process,” he said.
“Some transfers can take six months and as demand is growing a backlog of transfers has started.”
He said he was keen to advise those on the best outcome for their situation.
“I strongly recommend people seek financial advice, even if they don’t want to transfer,” he said.
Westpac regional general manager Lee Davidson said being an expat himself he understood the situation.
“As a migrant myself, transferring my pension I did it because if I passed away not all the money would go to my partner – just 50 per cent.
“You kind of don’t do it for yourself – you do it for your family.”
He said Australia had the best model of superannuation in the world.
“Your beneficiaries pick up the lump sum tax free if anything happens to you pre or post-retirement,” he said. “The advantages are real, you can take it all now.
“If you were daft you could take it down to the Crown and put it all on black.
“My advice is to invest it and prevent further losses through the weakening sterling while there still is a chance.”

http://www.inmycommunity.com.au/news-and-views/local-news/UK-government-pensions/7664717/


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## Classified (May 9, 2010)

*Link*

Pension change for expats - inMyCommunity - Perth, Western Australia


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## Classified (May 9, 2010)

*Pension info*

This is happening for expats in Spain as well.


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## Lynn R (Feb 21, 2014)

Anybody with a final salary, index-linked, unfunded Government pension would be stark raving mad to transfer it to any kind of private scheme. That was part of the great private pensions misselling scandal back in the 1980s, when people were being persuaded by sales pitches to transfer out of public sector schemes.


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