Reader question: I unexpectedly receive a pension benefit, will I now have problems with the tax authorities?
Dear readers,
I have received forms from a company pension fund unknown to me (until now) for applying for a retirement pension. I thought it was a mistake. However, at the helpdesk she told me that in 1972 I worked for about three months at a company, where I built up a pension of about 3 euros per month. This will probably be bought off for around 650 euros. At first I thought: “What a nice surprise”. On reflection, I wonder if that's the case.
I emigrated to Thailand in 2009. Completed an M form and received a final assessment for income tax and national insurance contributions for 2009. In 2012 I had to declare my conservative income. The same year I received a final protective assessment for 2009 of almost 140.000 euros. For this attack I received a ten-year deferment of payment. This is followed by remission, provided I do nothing wrong, according to Dutch tax law. What is not allowed, for example, is commuting a pension.
Since I knew nothing about this pension, I did not state this pension on the M form at the time, nor with my conservative income.
Do I still have to file a report? What does this mean for my already received final assessments? What will happen with the ten-year deferment of payment? What happens with the waiver? Is there an exception for small pensions?
I've had contact with the tax telephone a few times, but I don't get any unequivocal answers. Now I intend to ask these questions by registered letter to the Foreign Tax Office. However, I would like to find out more this way first.
Is there anyone among the readers who has already had this happen? Are there any readers who have knowledge of these matters? Or are there perhaps other readers who have tips for me?
Yours faithfully,
Hans
Hans, try to contact the relevant Pension Fund. I myself worked for a large pension fund for 40 years. I know that widow's pension can also be denied.
There was and this has happened several times, a man has died, has had 3 marriages, but one of them did not end well. She did not want to receive the widow's pension. Had to sign for that and it could not be changed back. Ask the same question to the Pension Fund from which you received the letter. Good luck! Christina
Hans,
I advise you to read the file “Tax file post-actives” in this blog.
The money isn't there yet so you don't have to do anything now. You can commute small pensions and I read that you do that too. The amount is so marginal that I wonder if that would make any difference in the protective assessment. I would let it rest.
If the money is paid out, it will be taxed in Thailand, subject to the conditions referred to in Article 18 paragraph 1 of the treaty. You can ask the pension company about this, but in most cases that is simply the case. See questions 3 and 4 of the file mentioned.
In that case, Thailand may levy. Thailand does not yet levy (everywhere) and for that I refer you to questions 6 to 9 of the aforementioned file.
I wouldn't worry and just collect the money. If the pension company still withholds payroll tax, I would reclaim it at the end of the year.
Dear Hans, very sensible of you to ask yourself the question!
After all, if I read it correctly, you would collect € 650 through the one-off surrender, which is not allowed, and therefore risk having to cough up an attack of 140.000…
Am so excused that this is a peculiar thing and - not quite kosher - seems. Are you sure the 1972 data is correct?
If that unknown pension fund has that data from before the digitized era, the Dutch tax authorities must have it too… and they should have been included in their calculations initially. However?
We therefore recommend that you submit it to the competent tax authorities to avoid surprises in the long term.
You're not doing anything wrong with that either. Do not do it registered yet, that is binding. Maybe by regular letter (or email). With a comparison you will have to sign documents that are then binding. Would love to know the outcome!
Davis, you read in the tax file, question 18 and the last question, that small pensions are allowed to be commuted. You are not breaking any rules with this. I did that myself after emigration, it was a lump sum payment of 750 euros.
Thanks Erik, suddenly an answer to Hans' question!
Facts, you emigrated to Thailand in 2009, completed your 2009 tax return via an M form. Conclusion, from 2010 you are therefore a non-resident taxpayer.
This pension will certainly be surrendered, the pension provider has to do that, there is nothing you can do about it.
Your final IB 2009 assessment will not be revised, the commutation and taxability fall in the year of payment, which is 2014, even if the calculation of the commutation sum may have been calculated from 2009.
If you request an exemption, the pension is not taxed in the Netherlands but in Thailand, unless it is a pension from the ABP based on working for the Dutch government at the time.
Your protective assessment and the postponement will therefore remain in force unchanged.
I share your opinion that the best way to put an end to any uncertainty is to ask the foreign tax authorities.
You received a message from the pension fund this year, so far you have not done and are not doing anything wrong with regard to. your protective assessment. If you now hear of a pension fund that you were not aware of, then this is a new fact. If this pension, as yet revealed, is not settled as set out above, then in the worst case scenario the assessment would require some supplementation and the deferral would also have to be slightly increased.
Wish you luck in writing to the IRS, nothing to worry about.
If you encounter unexpected problems, consult a tax advisor.
Nico B
Dear readers, thank you very much for your comments.
However, I still have one thing to say. This concerns a pension that ended before 1 January 2007. It therefore does not meet the conditions to be bought off without my permission. Maybe that's why it doesn't fall under the pension law and it shouldn't be bought off after all, but I don't know, the information on the tax site is not really understandable to me.
Yours faithfully,
Hans