LIFE & WORK CHANGES29 October 2026 · 9 min read
By Irish Tax Mate
Rates last updated: 29 October 2026 · How we verify
Tax on a Foreign Pension in Ireland: State Pensions, Work Pensions, USC and Treaty Exceptions
If you live in Ireland and draw a pension from the country you used to work in, Ireland taxes it once you're Irish resident: no foreign pension office deducts Irish tax, so you declare it yourself. Most foreign pensions pay income tax here, state pensions pay no USC, and none pays PRSI. A treaty or the paying country's own rules can take a pension out of Irish tax altogether, and that's where most of the mistakes happen.
IN SHORT
- Foreign pensions are taxed in Ireland at 20% or 40% like any other income, with USC on work pensions but not on foreign state pensions, and no PRSI (Revenue).
- Government-service pensions, German state pensions first paid from 28 November 2012 and pensions the paying country itself exempts can fall outside Irish tax.
- From 65 you get the Age Tax Credit and, on income up to €18,000 (€36,000 for a couple), no income tax at all.
In our example, a 68-year-old with a €12,000 UK State Pension and a €14,000 UK work pension pays €1,054.82 a year in Ireland: €955 of income tax and €99.82 of USC.
How is a foreign pension taxed in Ireland?
IN SHORT
- If you're Irish resident, a pension from abroad is taxable in Ireland at 20% up to your rate band and 40% above, after your tax credits (Revenue).
- Work and private pensions also pay USC; foreign state pensions don't, and no foreign pension pays PRSI.
- Nobody deducts the Irish tax for you: you declare the pension and Revenue collects it through your credits or a return.
| Type of foreign pension | In Ireland |
|---|---|
| State or social security pension | Income tax; no USC, no PRSI |
| Work (occupational) or private pension | Income tax and USC; no PRSI |
| Government-service pension | Usually taxed only in the paying country (treaty) |
| Work or state pension the paying country exempts | Usually exempt in Ireland too (s.200) |
| Lump sum from a foreign scheme (from 2023) | €200,000 lifetime tax-free, then 20% / 40% |
- Residence decides it, not where the money lands. Revenue says foreign pensions, including UK and US pensions, are generally taxable in Ireland (Revenue). If you're Irish resident and domiciled, the whole pension is taxable whether it's paid into an Irish account or left abroad; only non-domiciled residents can use the remittance basis (see below).
- It's taxed like a salary, not like savings. A pension is added to your other income and taxed at 20% up to the standard rate cut-off (€44,000 for a single person in 2026) and 40% above it. Your personal credit of €2,000 and any other credits then come off the tax.
- State pensions pay no USC. Revenue says foreign State pensions are not liable to USC, and its USC page lists social welfare payments received from another country as exempt. A UK State Pension or a French, Polish or Italian state pension is taxed only with income tax (Revenue).
- No PRSI on any foreign pension. Revenue says foreign pensions are liable to income tax and USC but not to PRSI. (Revenue).
- Convert each payment to euro. Revenue taxes the euro amount. Keep the pension statements showing the gross payment and any foreign tax deducted, and note the exchange rate you used and where it came from.
Which foreign pensions are not taxed in Ireland?
IN SHORT
- A foreign work or state pension is left out of Irish tax if the paying country wouldn't tax it for its own residents and has an income tax like Ireland's (s.200 TCA 1997).
- Pensions for government service are usually taxed only by the paying country under the treaty, unless you're an Irish citizen.
- German state pensions that started on or after 28 November 2012 are taxed in Germany, not Ireland (Revenue).
- The section 200 test. A foreign work pension or state pension is disregarded in Ireland if it would be disregarded for income tax in the country that pays it, for someone resident only there, and that country has a tax corresponding to Irish income tax (Tax and Duty Manual 07-01-09).
- No income tax back home means no exemption. Revenue's own example is a Cayman Islands pension: because the Cayman Islands has no income tax like Ireland's, the pension fails the test and is fully taxable in Ireland (Tax and Duty Manual 07-01-09).
- US Social Security is taxable in Ireland. It's excluded from section 200 by law. Under the Ireland–US treaty, Social Security paid to an Irish resident is taxable only in Ireland, so it goes on your Irish return in full (Tax and Duty Manual 07-01-09).
- Government pensions stay with the paying country. Under the Ireland–US treaty, a pension for service to the US government is taxable only in the US, unless you're both resident in Ireland and an Irish national (treaty, Article 19). HMRC applies the same rule to UK government pensions paid to Irish residents (HMRC).
- German state pensions since 2013. German social insurance pensions first received on or after 28 November 2012 are taxable in Germany. If you declared one in Ireland, Revenue refunds the Irish tax for 2013 onwards; older pensions can be kept in Irish tax by an election on Form MAP1 (Revenue).
- Each treaty is different. Some give a private pension to the country it comes from instead of the one you live in. Check the treaty with the paying country in our list of Ireland's tax treaties before you assume Ireland taxes it.
How are UK and US pensions taxed if you live in Ireland?
IN SHORT
- A UK State Pension, UK work pension or US Social Security paid to an Irish resident is taxed in Ireland, not where it comes from.
- UK and US government-service pensions are taxed by the UK or US unless you're an Irish national.
- If the UK is still deducting tax from a work pension, Form Ireland-Individual stops it and reclaims what was taken (GOV.UK).
| Pension, you live in Ireland | Who taxes it |
|---|---|
| UK State Pension | Ireland: income tax, no USC |
| UK work or private pension | Ireland: income tax and USC |
| UK civil service or council pension | UK, unless you're an Irish national |
| US Social Security | Ireland: income tax, no USC |
| US company pension or 401(k) | Ireland, under the treaty |
| US federal or state government pension | US, unless you're an Irish national |
- Stopping UK tax on a work pension. HMRC's Form Ireland-Individual lets an Irish resident with a UK pension or annuity get relief from UK tax at source, or a repayment of UK tax already deducted. You send it to Revenue, which certifies that you're Irish resident, and it then goes to HMRC (GOV.UK).
- Government pensions depend on your nationality. HMRC's treaty guidance says a UK government pension paid to an Irish resident who isn't an Irish national is taxed in the UK and not in Ireland; if you're an Irish national, including a dual Irish-British national, it's taxed in Ireland and not in the UK (HMRC).
- US private pensions go to Ireland. Article 18 of the Ireland–US treaty gives a pension for past employment, and US Social Security, to the country where you live, so both are taxed in Ireland (treaty, Article 18). US citizens still have their own US filing to do: our guide for Americans in Ireland covers it.
- The Employee Tax Credit can apply. Revenue's manual lets Irish residents claim the Employee Tax Credit (€2,000 in 2026) on a pension from another EU or EEA country or the UK, and on other foreign pensions that meet its conditions. You get one credit in total, however many pensions or jobs you have, and on qualifying income below €10,000 it's limited to 20% of that income (Tax and Duty Manual 15-01-07).
Do you pay USC and PRSI on a foreign pension?
IN SHORT
- No PRSI on any foreign pension, and no USC on a foreign state or social security pension (Revenue).
- A foreign work or private pension pays USC, unless your income for USC is €13,000 or less in 2026.
- Foreign state pensions don't count towards that limit, so many retirees pay little or no USC.
- The €13,000 limit. If your total income for USC is €13,000 or less in 2026, you pay no USC at all. Social welfare payments, including those from another country, are exempt and left out of that total (Tax and Duty Manual 18D-00-01).
- Revenue's own example. Someone with a €10,000 UK work pension declares it on Form 11, but pays no USC because the income is below the €13,000 exemption limit (Revenue).
- Above the limit, USC runs on the whole amount. Once income for USC passes €13,000, the bands apply from the first euro: 0.5% up to €12,012, 2% up to €28,700 and 3% up to €70,044 in 2026. Our USC guide has the reduced rates for over-70s and medical card holders.
- The over-65 income tax exemption doesn't cover USC. Citizens Information points out that being under the €18,000 or €36,000 limit takes you out of income tax only: USC is worked out separately (Citizens Information).
What credits and reliefs do you get from 65?
IN SHORT
- From 65 you get the Age Tax Credit of €245, or €490 for a married couple or civil partners (Citizens Information).
- If your total income is €18,000 or less (€36,000 for a couple), you pay no income tax at all.
- Just above the limit, marginal relief taxes only the excess at 40% if that works out cheaper.
- Age Tax Credit. €245 if you're single, widowed or a surviving civil partner, and €490 if you're married or in a civil partnership. It sits on top of your personal credit of €2,000 (Citizens Information).
- Exemption limits count your foreign pension. The €18,000 single and €36,000 couple limits apply to your total income, which Revenue defines as gross income from all sources, so a taxable foreign pension counts (Revenue). For a couple, the limit applies if you're jointly assessed and at least one of you is 65 (Revenue). Each of the first two dependent children adds €575, and each one after that adds €830.
- Marginal relief just above the limit. If your income is above the exemption limit but less than twice it, you can be taxed at 40% on the amount above the limit, with no tax credits, when that's less than the normal calculation (Citizens Information).
- A couple's example. A jointly assessed married couple both over 65 with €32,000 of foreign pensions between them is under the €36,000 limit and pays no income tax; at €40,000 they're over it and Revenue applies whichever of the normal and marginal calculations is lower.
Worked example: a retiree with two UK pensions
IN SHORT
- Mary, 68 and single, has a €12,000 UK State Pension and a €14,000 UK work pension in 2026.
- She pays €955 of income tax after three credits, and €99.82 of USC on the work pension only: €1,054.82 in all.
EXAMPLE
Starting data (assumptions): Mary is 68, single, Irish resident and domiciled, not an Irish national, and moved from the UK. In 2026 she receives a UK State Pension of €12,000 and a pension from a former UK private-sector employer of €14,000, both already converted to euro and paid gross (she filed Form Ireland-Individual for the work pension). She has no other income and no medical card, so the standard USC rates apply.
| Step | Amount |
|---|---|
| Total income | €12,000 + €14,000 = €26,000 |
| Tax at 20% (under the €44,000 cut-off) | €26,000 × 20% = €5,200 |
| Personal + Age + Employee Tax Credits | €2,000 + €245 + €2,000 = €4,245 |
| Income tax (normal calculation) | €5,200 − €4,245 = €955 |
| Marginal relief check | (€26,000 − €18,000) × 40% = €3,200, so not used |
| Income for USC (State Pension exempt) | €14,000, over the €13,000 limit |
| USC at 0.5% | €12,012 × 0.5% = €60.06 |
| USC at 2% | (€14,000 − €12,012) × 2% = €39.76 |
| PRSI | €0 |
| Irish tax for the year | €955 + €60.06 + €39.76 = €1,054.82 |
Her income of €26,000 is over the €18,000 exemption limit, and the normal calculation (€955) beats marginal relief (€3,200), so Revenue uses the normal one. The Employee Tax Credit is available because both pensions come from the UK (Tax and Duty Manual 15-01-07). If the €14,000 were a UK civil service pension instead, it would be taxed in the UK, not Ireland, because she isn't an Irish national.
How is a lump sum from a foreign pension taxed?
IN SHORT
- Since 1 January 2023, the first €200,000 of retirement lump sums is tax-free for life, foreign and Irish combined (s.200A TCA 1997).
- The next €300,000 is taxed at 20%, and anything over €500,000 at 40% plus USC (Tax and Duty Manual 07-01-09A).
- It goes on a Form 11 for the year you receive it.
- One lifetime limit for all your pensions. The €200,000 tax-free amount is shared between Irish lump sums and foreign ones paid on or after 1 January 2023. In Revenue's example, lump sums of €180,000 and €150,000 total €330,000, and the €130,000 above the limit costs €26,000 at 20% (Tax and Duty Manual 07-01-09A).
- The scheme must exist only for retirement. Section 200A covers foreign arrangements set up for the sole purpose of providing retirement benefits. Since Revenue's October 2026 update, a scheme that lets members withdraw money for other things, such as buying a home, fails that test even if you never used the option (eBrief 151/26).
- State schemes and some others are outside it. The regime doesn't cover state social security schemes, lump sums from qualifying overseas pension plans (QOPPs), or lump sums paid after someone's death (Tax and Duty Manual 07-01-09A).
- Lump sums taken before you moved still count. In Revenue's example, an Australian lump sum of €125,000 taken before arriving in Ireland uses up part of the limit, so a later €175,000 lump sum leaves €100,000 taxable at 20%: €20,000. Our pension lump sum guide covers the bands in detail.
What if you're not Irish-domiciled?
IN SHORT
- If you're Irish resident but not Irish-domiciled, a foreign pension is taxed only when you bring it into Ireland: the remittance basis (Tax and Duty Manual 05-01-21A).
- Revenue confirms this for foreign pension lump sums, which are taxed only on the amount remitted (Tax and Duty Manual 07-01-09A).
- Pension left abroad, no Irish tax. A non-domiciled resident who leaves a foreign pension in a bank abroad and lives on other money pays Irish tax only on the part brought into Ireland. UK income has been covered since 1 January 2008. Our remittance basis guide explains what counts as a remittance.
- Domicile is not nationality. You're born with a domicile of origin and keep it unless there's clear evidence that you mean to live in another country permanently and never return to live in your home country, per Revenue's domicile page. Living in Ireland, even for years, doesn't settle the question by itself.
How to declare a foreign pension: what Revenue asks
IN SHORT
- If you also have a job or Irish pension under PAYE, tell Revenue about the foreign pension: it cuts your credits and rate band to collect the tax through payroll (Revenue).
- With no PAYE income, or non-PAYE income over €5,000, you're a chargeable person and file Form 11 by 31 October each year.
- Add up the year in euro. Take the gross amount of each pension from its annual statement, any foreign tax deducted, and convert each payment to euro.
- Check which pensions Ireland taxes. Go through the sections above: state or work pension, government service, section 200, the treaty with the paying country. Leave out only what you can show is exempt.
- PAYE taxpayers: tell Revenue in myAccount. If you have a job or an Irish pension taxed under PAYE, declare the foreign pension and Revenue reduces the credits and rate band on your Tax Credit Certificate to collect the tax (Revenue). Non-PAYE income over €5,000 net, or €30,000 gross, moves you to Form 11; under that, Form 12 covers it.
- Everyone else: register and file Form 11. A retiree living on foreign pensions files Form 11 (on ROS or on paper) and pays the tax under self-assessment. The 2025 return is due by 31 October 2026, or 18 November 2026 if you file and pay on ROS (Revenue).
- Claim your credits on the return. Add the Age Tax Credit from 65, the Employee Tax Credit where it applies, and any foreign tax that was properly deducted under a treaty. Then check the result on your Statement of Liability.
Where do you start?
Find last year's statement for each pension and check whether it has ever been on an Irish return. If it hasn't, the next return is the place to put it right, and any foreign tax that shouldn't have been deducted can be reclaimed from the other country. Not sure whether Ireland taxes you at all yet? Start with the tax residence check.
Related reading
Questions we get asked
Is my UK State Pension taxed in Ireland?
Yes, if you're Irish resident. It's added to your income and taxed at 20% or 40% after your credits, but it isn't liable to USC or PRSI, because Revenue treats foreign state pensions like Irish social welfare payments for USC. From 65 you also get the Age Tax Credit and the over-65 exemption limits.
Do I pay USC on a foreign pension?
On a foreign work or private pension, yes, unless your income for USC is €13,000 or less in 2026. On a foreign state or social security pension, no: Revenue exempts social welfare payments from other countries. No foreign pension is liable to PRSI.
Is US Social Security taxable in Ireland?
Yes. Under the Ireland–US treaty, Social Security paid to an Irish resident is taxable only in Ireland, and Irish law specifically excludes it from the section 200 exemption. It's taxed at 20% or 40% after your credits, without USC.
Which foreign pensions are exempt from Irish tax?
A work or state pension the paying country wouldn't tax for its own residents, if that country has an income tax like Ireland's (section 200), pensions for government service that the treaty leaves to the paying country (unless you're an Irish national), and German state pensions first paid from 28 November 2012, which are taxed in Germany.
Can I take a lump sum from a foreign pension tax-free in Ireland?
Up to €200,000 over your lifetime, shared with any Irish lump sums, if the scheme exists only to provide retirement benefits. Above that, the next €300,000 is taxed at 20% and anything over €500,000 at 40% plus USC. You declare it on Form 11 for the year you receive it.