Readers’ forum: HMRC stance on state pensions for non-residents

I have clients who are emigrating to Australia. They both have UK state pensions. The husband also has a private pension and the wife a civil service pension. I have advised that once they become tax resident in Australia they can claim for their pensions to be paid gross under the UK-Australia double tax agreement (DTA) as article 17 states: ‘(1) Pensions (including government pensions) and annuities paid to a resident of a contracting state shall be taxable only in that state. (2) The term “annuity” means a stated sum payable periodically to an individual at stated times during life or during a specified or ascertainable period of time under an obligation to make the payments in return for adequate and full consideration in money or money’s worth.’

However HMRC states (tinyurl.com/HMRCpensions): ‘If you’re not a UK resident you don’t usually pay UK tax on...