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Will I face emergency tax on my lump sum withdrawal?
Thursday 20 Feb 2025I am aged 64, working full time, and due to get my company pension later this year. I have also got a SIPP which I have built up from my own pension savings. I would like to take some of that money out soon. Probably as a sizeable lump sum to partly spend, or maybe gift to my son. From reading some...
Do I really face a 90% effective tax rate thanks to pension IHT changes?
Thursday 13 Feb 2025I have been interested to read recent commentary on the proposals to extend IHT (inheritance tax) to pensions. One point caught my attention which was the reference to a 90% effective tax rate. I’m pretty certain my estate would fall in that category, but could you explain the 90% calculation,...
Should I combine my smaller pension pots with my larger SIPP?
Thursday 06 Feb 2025I have built up five different pension schemes under different employments over the past 20 years. Three are worth less than £8,000 each. However, my main SIPP is worth considerably more, around £300,000. My question is would I be better keeping these pensions separate and only taking them when I...
Can I take tax-free cash from my pension more than once?
Thursday 30 Jan 2025I am 64 and retired from my full-time job about four years ago. At that time, I took my tax-free cash from my SIPP. I haven’t yet taken any other money from my SIPP. Instead, I am working part-time as a consultant which gives me enough money for our needs. Over the last four years my pension has...
Can I bequest my SIPP assets to charity tax free?
Thursday 23 Jan 2025I have worked in the public sector for most of my life and since I retired, I am receiving a pension. I also have a small SIPP which I have not yet touched. My husband has a good pension of his own plus his state pension. When I die he will receive my share of our joint assets and will have enough...
How will I be taxed if I use my SIPP pot to buy an annuity?
Thursday 16 Jan 2025I am 67 and after combining two SIPPS I now have a single SIPP worth approximately £500,000. I drew income flexibly in the past from one of the SIPPs. My understanding is that I can take 25% tax free from my SIPP at any point and then the remaining pot is taxed on withdrawal at marginal rates. I...
What is ‘carry forward’ and how can it help with my pension planning?
Thursday 09 Jan 2025I’ve read that anyone who exceeds the maximum annual allowance of £60,000 for pension contributions in 2024/25 is liable for tax on the contribution above their allowance. However, I gather you can ‘carry forward’ up to three preceding years that you didn’t fully use your maximum annual allowance...
Should I look at alternatives to a SIPP in wake of inheritance tax changes?
Thursday 19 Dec 2024I am 67 and currently have a SIPP worth approximately £500,000. Because the favourable IHT regime is now ending I am now considering whether to reduce the amount in my SIPP and look at alternatives. My understanding is that I can take 25% tax free from my SIPP at any point and then the remaining...
How are my different pensions affected by inheritance tax changes?
Thursday 05 Dec 2024I was really disappointed to learn pensions will fall into inheritance tax. I have several different pensions schemes. One is a defined benefit scheme with my employer, and I also have an additional voluntary contribution section. But I also have a SIPP. Could you tell me if these pensions are...
When does the money purchase annual allowance apply?
Thursday 28 Nov 2024In a previous article you say that someone taking income from a defined benefit pension could still contribute to their SIPP up to the level of their earnings. Does this mean that the money purchase annual allowance of £10,000 applies only if you take taxable income from a defined contribution...