Income Tax (Earnings and Pensions) Act 2003 section 554Z4A

Temporary non-residents

Section 554Z4A ensures that certain lump sum payments from employer-financed retirement schemes, received during a period of temporary non-residence from the UK, are brought back into charge to income tax when the individual returns.

• Where an individual is temporarily non-resident from the UK, lump sum payments from employer-financed retirement schemes received during that absence are treated as if taken in the period of return for the purposes of the section 554Z2 income tax charge
• This applies where the payment would not otherwise be taxable (due to the existence of double taxation relief arrangements) but would be taxable if those arrangements were disregarded
• It also catches cases where the individual could have claimed double taxation relief to avoid the charge, even if no such claim was actually made
• No double taxation relief arrangement can prevent the individual from being charged to income tax on relevant steps treated as taken in the period of return under this section