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The taxpayer emigrated to Israel. He was in receipt of a UK pension that was exempt from Israeli tax for the first ten years of his residence in the middle eastern country.
He claimed it should also be free of UK tax under article XI of the UK/Israel double tax treaty. HMRC insisted the pension was liable. The taxpayer appealed.
The First-tier Tribunal said that the purpose of article XI was to exempt UK-sourced pension income from UK tax only if it was subject to Israel tax. It was not entitled to enable double non-taxation.
The article was concerned not with the status of the individual “but with the chargeability to tax of the specific income”. In this instance, the pension was not subject to Israel tax; UK tax was due.
The taxpayer’s appeal was dismissed.
