Proof of Income from a UK SIPP

[WhiteHatPhil]

As this forum seems to include a lot of financial information and discussions, I'm hoping its the correct place for my query.

 

This is a question aimed at any UK expats living in Thailand and drawing a pension from a UK SIPP.
Next year, from April 1st I will start to draw down a monthly income from my SIPP which is managed by a firm in the UK. I planned to have it paid into my UK bank account, pay taxes in the UK and transfer the money to my Thai bank account each month.
My question is
How is it possible to show proof of income, in order to reduce the 800,000 baht annual requirement? My aim is to show proof of income of 65K baht to nullify the requirement for "money in the bank" 60/90 days prior to visa extension.

It has been suggested elsewhere that I simply send this "proof of income" to the British Consulate in Bangkok and in turn will receive a "letter" to present to immigration. Is this correct? If so it makes the "proof of income" doubly important! 

 

(Please note that while I am currently considered to be a UK resident, I have lived in Thailand since 12 January 2018 and by April 2019 will not have set foot in the UK, making my status non-resident. Not sure if this makes any difference but I plan to keep my SIPP in the UK, draw down £1500/month and pay my income tax annually on the amount over the current personal tax allowance).

[dabhand]

Not quite the same as your situation but somewhat similar.

I drawdown from an offshore QROPS and am provided with a letter detailing the gross yearly drawdown. This is valid for three years.

I use this letter as proof of my income when requesting the Income Letter from the British Embassy. The details being included on the form that is within the British Embassy link for docs to be produced for the required Embassy letter to Immigration. As the QROPS letter was more than two years old when I sent it earlier this year, I also sent a copy of my UK bank statement which confirmed the amounts as still being received by me. In earlier years I did not send the bank statements and that was not a problem.

If your SIPP statement is produced on a yearly basis I would say that should be sufficient evidence.

The recent ability to scan all the documents and email the Embassy has made the process a lot easier, but, sadly, not less expensive.

Your planned drawdown of Stg1,500/mth means, at current exchange rates, you will be very close to the Bt65k/mth requirement. Unless you have any other income you can include on the Embassy form, suggest you have some funds in a local bank for the required period of time to cover any potential shortfall. Also remember that you should report your income on the Embassy form at the gross level and ignore any tax deductions.

 

 

[WhiteHatPhil]

On 7/27/2018 at 8:40 PM, dabhand said:

Not quite the same as your situation but somewhat similar.

I drawdown from an offshore QROPS and am provided with a letter detailing the gross yearly drawdown. This is valid for three years.

I use this letter as proof of my income when requesting the Income Letter from the British Embassy. The details being included on the form that is within the British Embassy link for docs to be produced for the required Embassy letter to Immigration. As the QROPS letter was more than two years old when I sent it earlier this year, I also sent a copy of my UK bank statement which confirmed the amounts as still being received by me. In earlier years I did not send the bank statements and that was not a problem.

If your SIPP statement is produced on a yearly basis I would say that should be sufficient evidence.

The recent ability to scan all the documents and email the Embassy has made the process a lot easier, but, sadly, not less expensive.

Your planned drawdown of Stg1,500/mth means, at current exchange rates, you will be very close to the Bt65k/mth requirement. Unless you have any other income you can include on the Embassy form, suggest you have some funds in a local bank for the required period of time to cover any potential shortfall. Also remember that you should report your income on the Embassy form at the gross level and ignore any tax deductions.

 

 

Great reply, thank you.  You are right in that in that it is very similar.  Can you think back to when you first started - were you living in Thailand when you took your first drawdown?  The reason being that I will only be starting to drawdown in April '19 and given that my extension of stay is due in October, I will need to have the proof of income and/or cash in the bank by July.  In effect, I will only have been drawing money for 6 months prior to my visa extension in October.  I know you can't speculate, but I wonder if a statement showing 6 months as opposed to 12 be acceptable by the Embassy...?

[dabhand]

51 minutes ago, WhiteHatPhil said:

Great reply, thank you.  You are right in that in that it is very similar.  Can you think back to when you first started - were you living in Thailand when you took your first drawdown?  The reason being that I will only be starting to drawdown in April '19 and given that my extension of stay is due in October, I will need to have the proof of income and/or cash in the bank by July.  In effect, I will only have been drawing money for 6 months prior to my visa extension in October.  I know you can't speculate, but I wonder if a statement showing 6 months as opposed to 12 be acceptable by the Embassy...?

Yes, I had started drawdown when I first used the statement. Initially I had been using the cash in the bank option.

As the Embassy income letter is valid for up to six months (I myself have used one that was four months old with no problem) maybe consider applying for it well ahead of time (within the six months window) and you will be able to go to the cash in bank option if not successful. Likely that it would be OK and also remember to include a yearly estimate of income based on your SIPP statement on the Embassy income detail form, not a six month or any other shorter period). The Embassy is not interested in when your extension commences. That question is never raised.

Good luck.

[rak sa_ngop]

One consideration is the amount of UK tax that will be deducted from your SIPP withdrawals. In my case the company/platform I used would let me withdraw tax free up to my personal allowance (11,500 GBP) and then withheld 40 pc as tax. I then had to claim the excessive tax of 20% back with my annual tax self assessment.

 

Maybe if you are making a regular drawdown you can get the correct tax code assigned at outset. In my case I made a one-off lump sum withdrawal.

 

But some UK tax you will have to pay!

[WhiteHatPhil]

2 hours ago, rak sa_ngop said:

One consideration is the amount of UK tax that will be deducted from your SIPP withdrawals. In my case the company/platform I used would let me withdraw tax free up to my personal allowance (11,500 GBP) and then withheld 40 pc as tax. I then had to claim the excessive tax of 20% back with my annual tax self assessment.

 

Maybe if you are making a regular drawdown you can get the correct tax code assigned at outset. In my case I made a one-off lump sum withdrawal.

 

But some UK tax you will have to pay!

Yes, I had considered drawing down an £18000 lump sum and simply living off it for the year. If I timed it right then I wouldn't need the proof of income as I would simply ensure I had the 800K baht in the bank for the requisite amount of time. The personal allowance has gone up £11850 but even so I would still have to claim the tax back on that amount as I would be given an "emergency tax code" as well as pay the tax on the remainder.