The Double Taxation Relief (Taxes on Income) (Canada) Order 1980

ARTICLE 17 Pensions and Annuities

1.  Pensions and annuities arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. However, such pensions and annuities may also be taxed in the first-mentioned Contracting State but only to the extent that the total amount thereof paid in any year of assessment or taxation year to the resident of the other Contracting State exceeds ten thousand Canadian dollars ($10,000) or five thousand pounds sterling (£5,000), whichever is the greater. However, the tax so charged in the first-mentioned Contracting State shall not exceed the tax chargeable on such pensions and annuities in the other Contracting State.

2.  Notwithstanding the provisions of paragraph 1 of this Article, pensions paid out of public funds of the United Kingdom or Northern Ireland or of the funds of any local authority in the United Kingdom to any individual in respect of services rendered to the Government of the United Kingdom or Northern Ireland or a local authority in the United Kingdom in the discharge of functions of a governmental nature may be taxed in the United Kingdom.

3.  The term “ annuity” means a stated sum payable periodically at stated times during life or during a specified or ascertainable period of time under an obligation to make the payments in return for adequate and full consideration in money or money's worth, but does not include payments of any kind under an income-averaging annuity contract.

4.  Notwithstanding any other provision of this Convention, alimony and similar payments arising in a Contracting State and paid to a resident of the other Contracting State who is the beneficial owner thereof shall be taxable only in that other State.