Part 9

Pension income
Chapter 18

Exemptions: Non-UK resident taxpayers

Overseas Service Act 1958
652
1
No liability to income tax arises on a pension—
a
which is paid under the authority of the Overseas Service Act 1958 (c. 14), and
b
which the Secretary of State certifies to be attributable to the employment of a person in the public services of an overseas territory,
if the foreign residence condition is met.
2
If the Secretary of State certifies that only part of a pension paid under the authority of the 1958 Act is attributable to the employment of a person in the public services of an overseas territory, subsection (1) applies only to that part of the pension.
3
For the purposes of subsections (1) and (2) a pension is paid under the authority of the 1958 Act if condition A or B is met.
4
Condition A is that the pension is paid under either of the following—
a
an order made under section 2 of the 1958 Act, or
b
section 4(2) of the 1958 Act,
as it has effect (by reason of section 2(3) of OPA 1973) as a scheme under section 2 of OPA 1973.
5
Condition B is that the pension is paid under a scheme which the Secretary of State—
a
has made under section 2(1) of OPA 1973, and
b
has certified to correspond to—
i
an order made under section 2 of the 1958 Act, or
ii
section 4(2) of the 1958 Act.
6
For the purposes of this section, a person is taken to be employed in the public service of an overseas territory at any time when—
a
the person is employed in any capacity under the government of that territory, or under any municipal or other local authority in it,
b
the person is employed in circumstances not falling within paragraph (a), by a body corporate established for any public purpose in that territory by an enactment of a legislature empowered to make laws for that territory, or
c
the person is the holder of a public office in that territory in circumstances not falling within paragraph (a) or (b).
7
In subsection (6) references to the government of an overseas territory include references to—
a
a government constituted for two or more overseas territories, and
b
any authority established for the purpose of providing or administering services which are common to, or relate to matters of common interest to, two or more such territories.
8
In this section—
- “the 1958 Act” means the Overseas Service Act 1958 (c. 14);
- “certified” means certified for the purposes of ICTA 1970, ICTA or this Act.
Pt. 9 excluded by 2004 c. 12, Sch. 36 para. 45A(1) (as inserted (26.3.2015) by Finance Act 2015 (c. 11), Sch. 4 para. 19)
Pt. 9: power to amend conferred (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), s. 4(3)
Pt. 9 modified (31.10.2023) by The Registered Pension Schemes (Authorised Member Payments) Regulations 2023 (S.I. 2023/1012), regs. 1, 4
Pt. 9 modified (6.4.2023) by The Public Service Pension Schemes (Rectification of Unlawful Discrimination) (Tax) Regulations 2023 (S.I. 2023/113), regs. 1(2), 23(2), 24(2), 26(2), 28(2) (with reg. 1(3))
Pt. 9 modified (14.9.2023) by The Public Service Pension Schemes (Rectification of Unlawful Discrimination) (Tax) (No. 2) Regulations 2023 (S.I. 2023/912), regs. 1(2), 9(2), 11(2), 16(2) (with reg. 1(3))
Pt. 9 modified (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2009/1171, reg. 5ZA (as inserted by The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 5(3) (with reg. 6))
Pt. 9 modified (13.2.2025 with effect in relation to the tax year 2024-25 and subsequent tax years) by The MPs’, Senedd and Assembly Pension Schemes (Tax) Regulations 2025 (S.I. 2025/52), regs. 1(2)(3), 4, 6, 7