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Schemes, policies, plans and arrangements
gadgetmind
Posts: 11,130 Forumite
I'm in our Group Personal Pension scheme with Friends Life and have two policies with them.
One was started in July 2007 and has a pension input period in mid July based on first contribution and a later nomination of PIP to pull it back a couple of weeks.
One was the result of a transfer and has a start date of 8th April 2011, which I think means its PIP aligns with the tax year as it was started after April 6th 2011.
Am I correct so far?
Friends Life have a document that explains PIPs etc., which observes that you can't have two PIPs in the same tax year, but goes on to say ...
"To circumvent this rule and individual could set up a new plan and nominate whatever pension input period they require."
So, some time in mid 2013, it looks like I could switch my contributions to the policy with the tax year aligned PIP, get "double bubble" contributions in 2013 to use up some old carry forwards, and also avoid "pushing" more contributions to July 2014 when the annual allowance is dropping.
However, wording bothers me. Is it each pot that has its own PIP? FL call my two pots "policies" but their document mentioned "plan".
The HMRC guidance here -
http://www.hmrc.gov.uk/manuals/rpsmmanual/rpsm06100060.htm
Talks about "arrangements" and observes that "An individual may have more than one arrangement within the same registered pension scheme and the pension input period for each arrangement may differ. Similarly it may differ from periods used for arrangements in other registered pension schemes for the individual."
Are my "policies" actually "arrangements" and if so, why do Friends Life call them "policies" in one place and "plans" in another?
One was started in July 2007 and has a pension input period in mid July based on first contribution and a later nomination of PIP to pull it back a couple of weeks.
One was the result of a transfer and has a start date of 8th April 2011, which I think means its PIP aligns with the tax year as it was started after April 6th 2011.
Am I correct so far?
Friends Life have a document that explains PIPs etc., which observes that you can't have two PIPs in the same tax year, but goes on to say ...
"To circumvent this rule and individual could set up a new plan and nominate whatever pension input period they require."
So, some time in mid 2013, it looks like I could switch my contributions to the policy with the tax year aligned PIP, get "double bubble" contributions in 2013 to use up some old carry forwards, and also avoid "pushing" more contributions to July 2014 when the annual allowance is dropping.
However, wording bothers me. Is it each pot that has its own PIP? FL call my two pots "policies" but their document mentioned "plan".
The HMRC guidance here -
http://www.hmrc.gov.uk/manuals/rpsmmanual/rpsm06100060.htm
Talks about "arrangements" and observes that "An individual may have more than one arrangement within the same registered pension scheme and the pension input period for each arrangement may differ. Similarly it may differ from periods used for arrangements in other registered pension schemes for the individual."
Are my "policies" actually "arrangements" and if so, why do Friends Life call them "policies" in one place and "plans" in another?
I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
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