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    • Gnoley
    • By Gnoley 12th Mar 17, 3:58 PM
    • 3Posts
    • 0Thanks
    Gnoley
    NHS pension and a SIPP
    • #1
    • 12th Mar 17, 3:58 PM
    NHS pension and a SIPP 12th Mar 17 at 3:58 PM
    Hello all, longtime lurker and learner here.
    My question is about recycling rules. I took early retirement from the NHS last year, and took my pension with a lump sum and actuarial reduction. I've gone back to work part time. Am I allowed to open a SIPP and put money in this tax year, or is that disallowed under the recycling rules? I've read and searched but am still confused!
    Many thanks for all help.
Page 1
    • xylophone
    • By xylophone 12th Mar 17, 4:11 PM
    • 20,938 Posts
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    xylophone
    • #2
    • 12th Mar 17, 4:11 PM
    • #2
    • 12th Mar 17, 4:11 PM
    Does your new employer offer a pension?

    You could consider a SIPP to which you would contribute from your earned income.

    https://www.gov.uk/tax-on-your-private-pension/overview

    http://www.thisismoney.co.uk/money/pensions/article-3256132/How-does-pension-recycling-work-good-tax-trick.html
    • Gnoley
    • By Gnoley 12th Mar 17, 6:01 PM
    • 3 Posts
    • 0 Thanks
    Gnoley
    • #3
    • 12th Mar 17, 6:01 PM
    • #3
    • 12th Mar 17, 6:01 PM
    Thank you Xylophone.
    I am back working part time for the NHS so I'm not allowed to contribute to the NHS scheme. If I've read your helpful links correctly, I am allowed to put in up to £7000 into a new pension this tax year?
    • xylophone
    • By xylophone 12th Mar 17, 6:40 PM
    • 20,938 Posts
    • 12,009 Thanks
    xylophone
    • #4
    • 12th Mar 17, 6:40 PM
    • #4
    • 12th Mar 17, 6:40 PM
    You will not be caught by the Money Purchase Annual Allowance (restricted to pension contributions of maximum of £10,000 in this year, £4000 next) because your lump sum and pension payments are from a DB pension.

    You have "relevant income" so in theory (and subject to Lifetime Allowance/Annual Allowance rules) can pay up to your net earned income into the SIPP and receive tax relief.

    You need to avoid the appearance of recycling your lump sum into the SIPP.

    http://www.pruadviser.co.uk/content/knowledge/technical-centre/flexi_access_drawdown_recycling/#
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