I have lived in the UK for over 20 years but now live in Spain. I have a UK private pension and am considering the most tax-efficient way to draw down from my UK pension. I've heard of something called ‘Beckham's Law’ but I am not sure what it’s about. 

Arthur Weller replies: 

Firstly, as far as the UK authorities (HMRC) are concerned, you should apply for an ‘NT’ (i.e., no tax) code (if possible), so that you receive your UK-source private pension without the deduction of UK income tax at source. Secondly the Beckham Law (officially the special expat tax regime) treats an eligible individual as a non-resident for Spanish tax purposes, even if they physically reside in Spain for more than 183 days a year. The primary benefit of the Beckham Law is that beneficiaries are generally taxed only on income sourced within Spain. Income generated outside Spain, including most foreign pensions, dividends, and capital gains, is exempt from Spanish income tax for the duration of the regime (up to six years). The UK-Spain double taxation agreement determines where income is taxed. For most private and occupational UK pensions (not government service pensions), the taxing rights typically reside with the country of residence (Spain). But under the Beckham Law, the individual is treated as a non-resident for tax purposes in Spain, so Spain generally does not tax the foreign-sourced pension income. However, to qualify for the Beckham Law, you must meet strict criteria and apply within a specific time frame. Advice from a Spanish tax adviser should be obtained.