TechTalk Vodcasts

Expert commentary and analysis on developments in the marketplace together with guidance on identifying planning opportunities.

Bringing you the latest technical expertise

To help support your client discussions, we’ve created our new TechTalk Vodcast series that looks at a wide range of financial planning topics. Our TechTalk Vodcasts will provide the latest technical information and industry insight that you can watch online and on the go in under 10 minutes.


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In this vodcast, we focus on pensions and bankruptcy, to understand:

  • possible claims against crystallising pension benefits for discharged pre-28th December 2000 bankrupts. 
  • the protections and their limitations for uncrystallised pension benefits if a member becomes bankrupt now.
  • the treatment of crystallised pension benefits during bankruptcy.

Watch now


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Watch now as we share technical guidance on:

  • When internationally mobile members can still contribute to UK pension schemes after leaving the UK
  • The tax relief rules for member and employer contributions
  • Brief reminders of related issues around overseas tax, scheme rule restrictions and transfers.


Watch now

  • Pensions & internationally mobile staff

    Hello, welcome to the second vodcast in the Scottish Widows Techtalk Vodcast series. My name is Paul Rutkowski and I am Senior Manager, Financial Planning at Scottish Widows. And I am Bernadette Lewis, Financial Planning Manager also at Scottish Widows.


    As an industry-leading workplace pension provider, we often get asked for guidance when staff are seconded overseas, or are moving to another country. Most of the same considerations apply to our individual pensions customers.

    From a UK tax perspective, ongoing employer contributions are possible, but the rules for member contributions are a little more restrictive.

    As well as explaining the key tax relief and contribution limits, this session will also provide brief reminders about related issues including overseas tax, scheme rules and transfers.

    And now I am going to handover to Bernadette.

    In this vodcast we are going to be considering when it’s possible for members of UK pension schemes to continue contributing after they have moved abroad. We’ll be focussing on the UK tax aspects – but will also be providing you with some reminders of other factors for you to consider.

    In this first slide and throughout this session when we refer to someone being non-UK resident, this means for tax purposes, as defined in the UK’s statutory residence test.

    Even if a UK pension scheme member is non-UK resident, they still have to comply with the normal annual and lifetime allowance limits.

    They might continue to get tax relief on member contributions to an existing pension after they become non-UK resident. But this is subject to two main conditions.

    Firstly, HMRC rules state that they need to have been UK resident when they initially joined the pension scheme.

    Secondly, their scheme needs to use ‘relief at source’. That’s where members pay contributions net of basic rate tax, and the provider adds this tax relief when it receives the payments. This applies mainly to group, individual and self-invested personal pensions plus stakeholder plans.

    Someone who joins a ‘relief at source’ scheme while they are UK resident, but then subsequently become non-resident, can continue to make tax-relievable member contributions of up to £3,600 gross per tax year to their existing scheme. That’s £2,880 net of basic rate tax.

    They can do this for up to five consecutive tax years of non-UK residence, starting with the first complete tax year that they’re non-resident.

    Member contributions may have to stop if they remain non-UK resident for over five tax years. That’s unless their scheme is able to accept non-tax relievable member contributions.

    However, some non-resident members won’t be able to get any tax relief on their contributions.

    This applies if they were non-UK resident when they first joined a UK pension.

    Or if they become non-UK resident and they’re in a scheme that doesn’t offer ‘relief at source’. This applies to most trust-based occupational pension schemes.

    In this slide, we’ll be looking at an example – just considering UK tax rules. Maya joined her employer’s group personal pension in July 2009, when she was UK resident.

    She was seconded overseas in August 2011, initially for four years. After her employer extended her overseas posting, she didn’t return to live and work in the UK until December 2019.

    Under the statutory residence test, Maya was actually non-UK resident for tax purposes from the start of the 2012/13 tax year to the end of the 2018/19 tax year.

    So, if she had relevant UK earnings over £3,600 in 2011/12 and 2019/20 – the tax years in which she actually left and returned to the UK – she could get tax relief on member contributions of up to 100% of those earnings for those tax years.

    For 2012/13 to 2016/17 – the first five tax years she was non-UK resident – Maya could continue to get basic rate tax relief on contributions to her existing GPP of up to £3,600 gross each tax year.

    For 2017/18 and 2018/19 she wasn’t eligible for tax relief on member contributions to any UK pensions.

    The rules are much simpler for employer pension contributions. There are no HMRC monetary or time limits on employer contributions for their non-UK resident employees.

    The employer benefits from UK tax relief on its pension contributions in the usual way. That is, the contributions are deductible as business expenses so long as they meet the ‘wholly and exclusively for a business purpose’ test.

    Some employers might consider offering a salary sacrifice to bypass the £3,600 for five years limit on tax-relievable member contributions. That works both in terms of UK tax and pension legislation.

    But bear in mind that the employee will be subject to another country’s tax and pension rules. Anyone considering this route should seek specialist tax advice, which we always recommend for overseas resident members of UK pension schemes regardless. This guidance also applies to those who are dual resident for tax purposes.

    The member’s country of tax residency will treat their UK pension as an overseas scheme in terms of its own legislation. So, the member needs to comply with any local tax rules relating to making member contributions or benefitting from employer contributions to their UK scheme.

    As well as tax rules, there are some other considerations.

    Each UK pension scheme has its own rules for deciding who it will accept as a member. Some non-UK residents and/ or to people who aren’t actually living in the UK will not be offered membership at the outset. Or a scheme might limit an existing member’s options if their tax or actual residence status changes.

    Some employers have automatic enrolment duties towards workers who aren’t UK resident for tax purposes or who aren’t living in the UK. If this creates difficulties in finding a scheme that will accept them, NEST has a public service obligation to provide automatic enrolment solutions.

    Any members who want to transfer their pensions to or from an overseas scheme will almost certainly need specialist advice.

    Transfers from UK schemes that don’t go into a QROPS – a qualifying recognised overseas pension scheme – face a 55% unauthorised payments charges.

    In addition, transferring to a QROPS triggers a BCE 8 – or, benefit crystallisation event 8 - test against the member’s lifetime allowance.

    In some cases, a 25% overseas transfer charge applies as well as a lifetime allowance charge, or instead of the charge.

    Coming the other way – the overseas scheme only has to meet HMRC’s relatively basic definition of a pension scheme. But the other country could have its own rules and barriers.

    Thank you – that concludes this vodcast on pension contributions for members who become non-UK resident.

    If you’d like any further information, please contact your dedicated Scottish Widows representative.

    Or you can also visit our Scottish Widows Adviser Extranet for a full range of technical resources, including Techtalk, MasterClasses and a wide range of CPD. Thank you once again.

    Thanks very much and please look out for the next in our vodcast series.


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