Taxed at source uk income

Can anyone explain what "taxed at source" means in regard to uk pensions.
I have heard that uk Government pensions like police and nhs are taxed at source so not taxable in Spain.
However my Spanish accountant here says once a resident, all uk income is taxed in Spain and not in the uk??

My pension in taxed in the UK "at source" because it's classed as a government pension. It's a reciprocal agreement between the UK and Spain, I believe. Army. Police, Civil Service and others are included. NHS ones aren't actually classed as government pensions, funnily enough, because that's what my wife receives and all her tax is payable over here. When I went to do it last time, I was told that the government pension thing might be getting scrapped soon, but, as far as I know, there's been no change recently.

Gary, how does this work then? Do I just get paid my police pension and have it taxed in the uk, then only declare it in Spain but am not taxed in Spain

Yes, you declare ALL income in order for your tax liability in Spain to be calculated then any tax you've paid in UK is offset against that.

A.N.Other wrote:Yes, you declare ALL income in order for your tax liability in Spain to be calculated then any tax you've paid in UK is offset against that.

That is not correct as far as UK Government pensions are concerned. Such pensions are taxed solely in UK and are not taxed in Spain. Such pensions, though, are declared in Spain as exempt income. The upshot of this is that any tax payable in Spain may well be at a higher rate as their total income may move them into a higher tax bracket. If they are not liable to pay any tax in Spain then their UK Government pension so declared will not alter that position.

I have such a UK Government pension but no Spanish income. My UK pension is taxed at source in UK and I pay no Spanish tax whatsoever.

Espanabums wrote:


That is not correct as far as UK Government pensions are concerned. Such pensions are taxed solely in UK and are not taxed in Spain. Such pensions, though, are declared in Spain as exempt income. The upshot of this is that any tax payable in Spain may well be at a higher rate as their total income may move them into a higher tax bracket. If they are not liable to pay any tax in Spain then their UK Government pension so declared will not alter that position.

I believe that's what I said in substance.

I have a local government pension plus UK state pension. In Spain both are added together and tax paid accordingly. The local government gas a zero tax code therefore tax not deducted in the UK.

I get a pension from a local govt job i had. they knock the pension of then next year when i pay my resident tax i get it all back off the uk in order to givve it to spain. Its the bureacratic abortion you expect from the spanish.

Unless you're exempt in UK you will be taxed in UK.
This may all change over the Brexit nonese.