Pension direct to Thailand

[Big Boy]

I am about to ask a question for a Thai friend who lost her English husband in tragic circumstances a couple of years ago.

When he died, he left her very well provided for. She has been transiting between the UK and Thailand ever since. She has now decided that her future is in Thailand. She is going to rent her home out, and move everything else to Thailand.

She has asked me to help her with her company pension that she receives from her husband's employer ie she wants the money transferred direct to Thailand every month. I believe the pension is quite substantial for a Thai to live in Thailand on (in the region of £2K per month).

If I am to help her with it, I need to know the answers to a couple of questions, which I am sure some of you guys must already have encountered with your own UK pensions:

- Is it feasible to get a UK company pension paid directly to a Thai bank account?

- If it is, I guess there will be money transfer + administration charges. Is this correct? Does anybody do it? What are the charges?

- She obviously has to pay UK taxes on her income. Would that still be done at source, or does something else come in to play?

- I believe (not sure yet) that she will still be paying National Insurance. If she moves to Thailand, would that have to continue? If not, does anybody know how to stop it?

- For those who don't have their pensions paid direct to Thailand, how do you manage? I've suggested having it paid into a Nationwide account, and withdrawing via ATM.

- If she goes down the Nationwide route, how would she manage if she needed access to a large amount of money quickly?

- Moving back to Thailand, how would she fare if she had to return to the UK to attend to her house for example? Does owning a UK property give her any rights when applying for a UK visa?

Above are just a few questions that come in to my head immediately, I am sure there will be more. I, and my friend would be very grateful for any advice you can give. Please don't feel restricted by the above questions - any constructive advice at all will be gratefully received.

Incidentally, I've already suggested giving her money to me - she didn't appreciate that advice

I intend visiting her to sort things out on the 1st and 2nd December.

[MrPlum]

Deleted. Duplicate post.

[MrPlum]

I know that military pensions can now be paid direct into a Thai bank and the charges are substantially cheaper than using ATMs.

If she knows her pension provider presumably they have a helpline or online presence where she can find answers to many of these questions. Why not use Skype or similar and call them cheaply?

[Randy Cornhole]

I had always heard that if you have a UK pension paid into a Thai bank then you forfeit any index linked increases which you would get if it is paid into a UK bank. However I am not sure if this is the case with it being a second party pension. I hope that makes sense...

[lindosfan1]

Big boy
The taxation depends on the type of pension. If it is any form of government pension tax will be liable in the uk.
The tax rules also depend on residency if she is resident in Thailand the pension can be received free of UK tax. Then she can elect to receive the pension tax free but will have to pay tax in Thailand.
With the letting of her property if she has an agent the the agent will be liable to tax. I cannot remember the exact rules on this sorry.
My advice on the financial side is go to a good accountant, this will save a lot of money.
It can get very complex a friend of mine has pensions in the US and the UK he pays us tax on the US pension is taxed on both pensions in the UK but gets credited with the US.
A good accountant will look at the tax rates in each country and decide the best way to save money.
All this only applies if the pension can be received free of tax in the UK.
The pension provider or the account will know this.
It is only the state pension which does not give annual increments and this is governed by residence. EG resident in the EU you will get the rises resident in Thailand you will not, it does not matter which bank it is paid into.
Hope this helps.

[HHTel]

With regard to having your pension paid in Thailand, I had the same problem as my provider insisted on paying into a UK bank. The Bangkok Bank in London will accept payments with an automatic transfer into an account in Bangkok Bank Thailand. The London branch is not open for personal accounts so you need to tell them that it's for a pension transfer. It's worked well for me for the last few years. Any money that's paid into my Bangkok Bank London account, is automatically transferred into my Hua Hin account after 3 working days. I don't need to do anything.

With regard to taxation, Thailand and UK have reciprocal tax agreements so you can choose which country to be taxed.

[Big Boy]

Thank you very much guys, the advice I am getting is very good, and is certainly giving me much food for thought.

From the basics of talking to an accountant - obvious, but I hadn't even considered it , through to cheap phone calls, to tax rates in both countries and even opening an account with Bangkok Bank in London. Its all excellent information.

Please keep the information coming. When we visit her on 1 & 2 Dec, we have a lot of business to get through, and only 2 days days to complete it. Before we travel, I must have a fairly good plan of action in my head.

I'm still hoping for some advice regarding returning to the UK to maintain her property if required. I'd like to know if anybody has experienced something similar. I will e-mail the Embassy in Bangkok later, and ask for their opinion.

[kendo]

Hi Big Boy,
My wife has held her indefinite leave to remain visa for less than one year, i am sure when we got her visa back, the paper work did state that you can not live abroad for more than two years or they have the right to revoke the visa,i am more than happy to dig the paper work out tomorrow, but i have just done 12 hours ( 9 hours up the crane) and need beer and my dinner but joking apart more sound advice is to check with the home office as there rules and protocol change on a regular basis.
I think tho, if she holds a british passport aswell as her Thai passport then this won't be an issue.
kind regards.
Kendo.

[Big Boy]

Thanks Kendo. That information is definitely correct.

However, the exam question is, 'What happens when her current visa expires? Will she be able return to the UK to maintain her home using the fact she owns a property in the UK? Or will she have to endure the lottery that every other Thai National has to endure?'

The only person I know in a similar situation is Mr Thaksin, and owning a property in the UK has not helped him.

[kendo]

The life in the U.K test (exam) has been going for all most 3 years thats for going from a 2 year resident permit to indefinite leave, know compulsory, i dont think that will safe guard re entry to the U.K, you really need clarity on that very important.
Kind regards.
Kendo.

[Digger]

[
I believe (not sure yet) that she will still be paying National Insurance. If she moves to Thailand, would that have to continue? If not, does anybody know how to stop it?

Big Boy,
you have a handfull here,but as to NI its fairly simple,she will either be employed,self employed or unemployed so either she is paying NI or state is paying her contributions.If she moves to Thailand the thing stops unless she wishes to continue paying so as to receive old age pension or medical benefits if she returns to uk.However if she stops paying any medical assistance she could claim will soon evaporate as has happened to many uk residents who moved on after paying for years.
As to renting her house and living in Thailand,naturally she will be liable to pay UK tax on her rental income but that comes with many tax writeoffs but under uk law she has to appoint an agent and get a dispensation number from the overseas residency unit at Bootle to receive rent without deduction of tax at source.This agent does not have to be an Estate agent but given her situation and lack of experience she may be best going for a full managed service at 13 to 15% charge plus vat which is a lot of dosh.This will make her liable to make a full annual tax return for which she may have to pay an accountant close to a £1000 for.With so little profit in renting,the profit used to be in capital appreciation not sure keeping a residence now is such a hot idea,selling and dumping the money offshore and tax free is a lot less hassle for someone who is returning to live fulltime in LOS.The ownership of a house in no way helps her visa situ.
She may need to simplify her goals or it may become too daunting.
Good Luck

[Nereus]

I can`t help you much with this BB, as it is not my country of origin. But I did have to get involved on behalf of an English friend who passed away several years ago. His (legal) Thai wife was entitled to a widows pension, regardless of where she lived. She had in fact never been to the UK.
Maybe the pension is subject to a "means test", and in your case, she would not qualify, but just something else to throw into the basket.

[Huahinian]

Big Boy - I receive a UK company pension directly into my Kasikorn Bank account in Hua Hin (it does take 3/4 weeks to arrive though). My pension is taxed at source and the Pension Fund pay the transfer charges. As far as I am aware, it is only the State pension that is frozen - my pension certainly increases each year.

If I can help further, please PM me.

[Zidane]

I,too,have a UK company pension transferred monthly into the Bangkok Bank.There is a 1.75p administration charge for this.
It is taxed at source but I dont pay any National Insurance on it.
The company pension increases every year but the government pension is frozen if you live abroad.
I believe it is possible if you can prove you have lived abroad for three years or more you can get the tax stopped in the UK but would be liable for tax in Thailand instead.
If she rents her house in the UK she would be liable for tax on the income earned plus any agents fees.....also would have to complete an Income Tax return yearly as Digger says.
As regards returning to the UK she really needs to ask someone like Thai Visa about her rights.I've a feeling she might have to go through the application process again,unfortunately.
Although the UK housing market is in deep decline (eg. 300k now selling for 240k ) it might be worth considering selling up.
Would save a lot of hassle and help keep her sanity ! But I know money is no.1 for many Thais and not easy to convince them to accept a 3m.baht loss on the property.
Good luck,anyway.

Zidane

[lindosfan1]

Big boy I have PM'D you.