Triviality rule

madeinireland_2

Does the triviality rule apply to each pension or the sum of your pensions?

My wife has a couple of small pensions but I'm thinking of contributing to a stakeholder pension to either build her pension up to her personal allowance limit or utilise the triviality rule.

Am I also right in thinking that when you get the state pension you only need to build up a pension paying about £2.5k to use up the full allowance assuming you have a full state pension?

Thanks...

McKneff

Its the sum of All of your pensions up to £18.000

McKneff

McKneff wrote: »

Its the sum of All of your private pensions up to £18.000

State pension doesn't come into the equasion.

bigadaj

There are two triviality scenarios.

Either all your pensions, excluding the state pension need to total less than £18k, or you can have up to two pensions of less than £2k which can be accessed on their own, known as stranded pots. The stranded pots count towards the larger triviality figure.

If your intent is to use the stranded pots route then check the provider allows this, there have been threads where people are with firms that don't allow it, and it's obviously too small to transfer, so you just have to take their annuity, £500 cash and a couple of quid a month probably.

McKneff

bigadaj wrote: »

There are two triviality scenarios.

Either all your pensions, excluding the state pension need to total less than £18k, or you can have up to two pensions of less than £2k which can be accessed on their own, known as stranded pots. The stranded pots count towards the larger triviality figure.

If your intent is to use the stranded pots route then check the provider allows this, there have been threads where people are with firms that don't allow it, and it's obviously too small to transfer, so you just have to take their annuity, £500 cash and a couple of quid a month probably.

Thanks bigadaj, I had forgotten about the 'stranded pots'

wallpaperman

bigadaj wrote: »

There are two triviality scenarios.

Either all your pensions, excluding the state pension need to total less than £18k, or you can have up to two pensions of less than £2k which can be accessed on their own, known as stranded pots. The stranded pots count towards the larger triviality figure.

The stranded pots do not count towards the larger triviality figure.

For example, you can have a fund of £17,900 and two other funds of £1950 each and all three can be taken as trivial/stranded pot lump sums.