If your UK pension plan is recognized as a company pension plan in Canada, when you transfer it to a special type of RRSP in Canada you will receive what amounts to a one-time increase in the RRSP contribution limits. You declare the amount transferred as income on your Canadian tax return and then take a deduction for the contribution to the RRSP. The net result is no tax while the funds remain in the RRSP and you can continue to make annual RRSP contributions in accordance with the government rules.
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If you transfer your UK pension to Canada, it may qualify to go into a special type of RRSP. There is no tax on the lump sum transfer and you would only pay tax when you take some money out.
There are two major exceptions: The first is the old age or state pension and the second is any unfunded pension plan (often provided by the Public Sector e.g. National Health Service, Teachers, Civil Service, Police, Military).
