UK TAXING OF GOVERNMENT PENSIONS FROM 2025

 

UK TAXING OF UK GOVERNMENT PENSIONS FROM 1 JANUARY 2025

In view of the liklihood of the above, if you are affected by this issue, it is suggested that you may care to write to your MP [ie the MP where you are registered to vote or were last registered to vote before you left the UK] along the following lines:

Dear xxxxxxxxxxxxx MP,

Until 2018, an arrangement existed under the Double Taxation Agreement between UK and Cyprus that allowed retired UK government service pensioners (HM Forces, Prisons, Teachers, NHS etc) to be taxed in Cyprus rather than in the UK.

However in March 2018  the DTA was renewed and reversed this hitherto valuable benefit. Government pensions (not the state pension) would henceforth be taxed at source. Clearly many pensioners had decided to live in Cyprus with the favourable taxation a major consideration. Many have been here for many years, and this retroactive tax will cause them severe hardship.

 This decision was  successfully appealed in 2018 this and a five year  moratorium was granted and this expires on 31 December 2024. The Forum acting on behalf of the pensioners has requested  that enduring rights be granted for those pensioners who qualified in 2019 for the exemption.

 A letter from Nigel Huddleston MP, Financial Secretary to the Treasury, has just been received explaining that the review of this matter is ongoing.

  We very much hope that you will agree with us that the reasons for offering the Protocol have not changed, if anything the cost-of-living crisis has worsened. We would very hope that we can ask you to support our request to your colleagues at the Treasury to extend the term of the Protocol for those individuals who were in scope under the Protocol “for the lifetime of the individual” in 2018.

 I am writing to respectfully request your support  for the proposal that aging Government Service pensioners living in Cyprus be granted enduring rights to replace the temporary exemption from taxation at source on their pensions, as granted in the attached protocol.

 Hardship arising from cost of living pressures and exchange rate deterioration are already causing many stress and serious decline in their living standards. Additionally aging pensioners on the island do not have opportunities to replace income lost (e.g. opportunities to take up paid employment)  through this additional tax burden, nor access to welfare benefits that are available to pensioners in UK.

 It might be helpful to note that the number of qualifying pensioners, who are now eligible to vote in UK elections,  is reducing annually arising from death and returning to live in UK.  Their return to UK would add stress to the welfare budgets, housing, and NHS services within the UK.

Any help you are able to give us, particularly as a large number of pensioners are veterans, would be much appreciated,

Yours Sincerely,

 

(Your Name and UK postal code)