Final salary pension - tax implications?

At my last job, I didn't join the company's stakeholder pension as I'd been warned of the tax implications for a US citizen -- as the investments would be considered PFICs, I'd be taxed out the wazoo by the IRS.

With my new job, the company is offering a final salary pension. Am I right in thinking that this is ok for me to join, from the perspective of the tax implications? How and when would the distributions be taxed?

Many thanks!

Employer contributions are reportable annually on your US income tax returns as additional income (IRS Code section 402(b)) unless you elect not to report by using Article 18(5) of the US/UK treaty by filing a Form 8833 every year.

The tax on distributions will depend on which of these options you elect each year on your US tax returns.

It might be better not to invoke the tax treaty in this case. Then declare the pension contributions on your 1040, but don't use the foreign income exclusion, use the foreign earned tax credit. These might cover your UK income plus employer pension contributions for US tax purposes. If this is the case you'll have declared the employer contributions, paid tax on them using your tax credits and then they'll be US tax free or highly reduced tax when you take them out.

Do your tax both ways to see what works best and maybe get some professional advice for the first couple of yeras until you're comfortable.

i have been told that contributions to a pension by an individual are deductible or excludable in computing taxable income in the US-- does anyone know if this is indeed true? and if my contributions to a final salary pension scheme could be used in this way?  if so, i assume it would be smart to not invoke the tax treaty on the employer contributions?  or am i looking at this the wrong way?

does anyone know what the tax situation is if you do invoke the tax treaty--when the income is received yearly after retirement (in my case, there is no lump sum payout, just an annual amount received each year), i assume this is taxable in the UK?  can you not just apply the foreign income exclusion or the foreign earned tax credit then, in this case?

Your new job is offering a final salary pension? Wow - I didn't think any companies were doing those any more, in fact I have 15 years in an IBM one and they are considering stopping it for existing members as well.

Yeah, it's pretty remarkable, but it's in the public sector which helps explain things.
That and the flexi-time program which enables me to take up to 56 days off a year (full-time, salaried job) means I think I've stumbled onto something pretty awesome!