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Topic: U.K Retirement Annuity - General or Passive 1116?  (Read 1054 times)

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U.K Retirement Annuity - General or Passive 1116?
« on: April 12, 2022, 10:01:06 AM »
I believe that many list tax paid on a U.K pension, (private or workplace) in the general category of 1116. Passive is for interest, dividends and annuities etc. Does this extend to retirement annuities too for the passive category? I've searched the web to find an answer, but non is forthcoming. the IRS reading is vague and simply states that an  'Annuity' would be classed as passive for 1116. Of course an annuity could be a purchased product and nothing to do with retirement.

I'd be interest to learn what category of 1116 other list their U.K retirement annuity in?

Thanks in advance!


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Re: U.K Retirement Annuity - General or Passive 1116?
« Reply #1 on: April 12, 2022, 10:31:18 AM »
My wife and I only have pensions that our accountant has classed under the General Category, and our interest income either does not exceed the £1k tax fee allowance or is from premium bonds and cash ISAs so no UK tax.

Looking at the IRS instructions it looks clear that annuity income should be classed as passive.  But as you say, anyone can buy an annuity whether from retirement savings or regular savings. 

I also don't see foreign pensions mentioned in the 1116 instructions, and I guess I would ask if the IRS cares which category is used for annuities and pensions.

https://www.irs.gov/pub/irs-pdf/i1116.pdf

Quote
Passive income. Passive income
generally includes dividends, interest,
royalties, rents, annuities, excess of
gains over losses from the sale of
property that produces such income or
of non-income-producing investment
property, and excess of gains over
losses from foreign currency or
commodities transactions.
Dual USC/UKC living in the UK since May 2016


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