21 August 10 
Cross Border Tax Q&A Dear Sir
This year I am eligible to claim a UK state pension for myself and my wife (as a dependent).
Over the last ten years, I have made voluntary contributions to the UK National Insurance, so as to maintain that eligibility for a pension.
How do I offset the total cost of those contributions made to that foreign pension scheme, so as to limit the amount of Canadian income tax that foreign pension might incur?
Regards
XXXXXX
Hi XXXXXX
The taxes you pay in Canada on the US pension can be offset by any withholding taxes the UK representative withholds e.g. foreign tax credit. However it’s not going to be possible to get a foreign tax credit for the voluntary payments to the government plan. The only way that would be possible would be if you were a short-term resident of the UK and your paid “social taxes” to the UK and never intended to collect a government pension when you left.
Hope that helps and don’t hesitate to give me a call if you need more clarification.
Regards
Phil Hogan, CA
250-661-9417
Dear Sir
This year I am eligible to claim a UK state pension for myself and my wife (as a dependent).
Over the last ten years, I have made voluntary contributions to the UK National Insurance, so as to maintain that eligibility for a pension.
How do I offset the total cost of those contributions made to that foreign pension scheme, so as to limit the amount of Canadian income tax that foreign pension might incur?
Regards
This commentary reflects the personal opinions, viewpoints and analyses of the Beacon Hill Wealth Management Ltd. partner providing such comments, and should not be regarded as a description of advisory services provided by Beacon Hill Wealth Management Ltd. or performance returns of any Beacon Hill Wealth Management Ltd. client. The views reflected in the commentary are subject to change at any time without notice. Nothing in this commentary constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Beacon Hill Wealth Management Ltd. manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results. Any discussion about taxation is for educational purposes only and should not be viewed as professional advice. Consult your tax professional for tax advice on your particular situation.
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