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Australian Superannuation fund

Australian Superannuation fund

I have a retired client who has been non-resident (and non-domiciled) for many years. She receives pension income from an Australian superannuation fund which is paid to her and her husband in Australia tax free as the money was originally taxed going into the fund.

For family reasons, last year she became resident (here for more than 181 days in the tax year). Under article 17 of the UK/Australia Double Tax Treaty "Pensions (including government pensions) and annuities paid to a resident of a Contracting State shall be taxable only in that State" which would imply that it is taxable in the UK while she is resident in the UK, however, since the pension appears to be not taxable in Australia (by virtue of it being paid from taxed income in the first place) it seems inequitable that it would be taxed in full in the UK. Does anyone have any experience of income from this kind of fund?

Incidentally none of the income has been remitted into the UK and I am aware of the remittance basis claim that could be made, however, she does have UK taxable income from property letting and I would rather avoid the removal of personal allowances if at all possible.

Any thoughts would be appreciated.


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