I mentioned on here before that I have a USA pension which is a 401K (investment account) and I am currently looking at getting access to these funds as I now live in UK (and have done for past 6 years).
I have spoken to the plan holder and they have given me a form to complete to prove I am a foreign national not living in the US and because of some treaty between the US and UK, they will waive the 20% federal tax penalty which would have been taken from the total amount. they will also waive the 10% early withdrawal fee too which is great.
My question is when I recieve this money in the UK, probably by way of a US cheque into a UK bank account (they cant (wire) transfer to UK accounts for some reason), will I be liable to any UK taxes on this money?
How would HMRC know where this money came from and why should they tax me on it? The money was pre-tax savings in the USA when I was living and working there, so what has it got to do with HMRC?
Any ideas if I will be taxed somehow?
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