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Pension freedoms: How can I claim back tax taken in the UK?

how to claim the tax back

Ask an expert: A reader who lives in Spain for half of the year and has his pension paid into his Spanish bank account asks how to claim back tax


Q. I am a British national resident who lives in Spain for half of the year. My UK state pension is paid into my Spanish bank account. No tax is deducted by HM Revenue & Customs (HMRC) as I am resident in Spain and I am therefore required to declare all of my worldwide income to the Spanish tax authorities (Agencia Tributaria).

I also have a self-invested personal pension (Sipp) in the UK and I would like to cash in some or all of it under the new pension rules. From what I have read, UK tax will be deducted by the pension provider when withdrawals are made. I will have to declare any (private) pension income to the Agencia Tributaria and it will be taxed by them. How can I recover the tax deducted in the UK?

A. As a Spanish resident, you can apply to HMRC to get income taken from your private UK pensions paid without any UK tax deducted. As Britain

has a double taxation agreement with Spain, your pension income gets full relief from UK tax, so you will only get taxed in your country of residence.

If you've not already done so for your UK state pension, you should complete a Spanish double taxation agreement claim form and have it approved by your local tax authorities. Jamie Jenkins, head of pensions strategy at Standard Life, says that this approval should then be submitted to HMRC, along with a completed HS304 form. This form can be found on the government website (

Once HMRC has agreed your claim, you should pass its authorisation to your pension provider(s) so you can have your pension income paid without tax deducted.

Mr Jenkins says that should you start taking your pension income before making a successful submission to HMRC, so that UK tax is deducted, you can apply for a refund. HMRC's R43 form allows non-UK residents to claim for tax repayments, although any refund should then be reported to the Spanish tax authorities.

Do you have a question for our experts? Email or write to Telegraph Money Ask an Expert, 111 Buckingham Palace Road, London, SW1W 0DT.

Category: Taxes

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