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  • FIRST POST
    • Muscle750
    • By Muscle750 11th Jul 17, 7:46 PM
    • 833Posts
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    Muscle750
    If i take 25% tfls?
    • #1
    • 11th Jul 17, 7:46 PM
    If i take 25% tfls? 11th Jul 17 at 7:46 PM
    If i take 25% TFLS from my Pru Private pension which along with my current Salary will push my annual income well into HRT bracket figure will i pay more tax on my earnings. Sorry for a stupid question
Page 1
    • MoneySavingUser
    • By MoneySavingUser 11th Jul 17, 7:57 PM
    • 1,601 Posts
    • 642 Thanks
    MoneySavingUser
    • #2
    • 11th Jul 17, 7:57 PM
    • #2
    • 11th Jul 17, 7:57 PM
    No, the TFLS is not income for tax purposes.

    It may affect benefits.

    If you take more than the TFLS you might trigger the Money Purchase Annual Allowance.
    • Aretnap
    • By Aretnap 11th Jul 17, 7:58 PM
    • 2,659 Posts
    • 2,103 Thanks
    Aretnap
    • #3
    • 11th Jul 17, 7:58 PM
    • #3
    • 11th Jul 17, 7:58 PM
    The tax free lump sum is, erm, tax free. This means it not counted as taxable income at all and will not result in you having to pay extra tax on your other income.

    Obviously if you took more than 25% out then the extra would count as taxable income and might push you into the higher rate tax bracket - which is a good reason to withdraw our offer a number of years or wait until you are earning less from your day job before starting to withdraw it.
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