small pot

judgejolly

I am 70 years of age and have a small pension pot of approx £28k. Under the new pension rules, am I correct in thinking that I can take 25% of that tax free and take the remaining £21k minus 20% income tax ? or is there a way of taking it to reduce the tax ? I only have a basic state pension to live on by the way.

Linton

If this is the only pension you have ever had (other than state pension) and you have never done anything with it, yes you can get the cash for it by claiming "triviality" as the sum of all your pensions is less than £30K. You can take 25% tax free but the rest is taxed as income. You would need to talk to your pension provider about this.

Another option is to wait for the next set of reforms due in April 2015 which may allow you to take as much as you like as taxed cash when you like (after the 25% tax free). You could then take out sufficient each year to keep your total income including your state pension under the tax allowance. There is a risk that the actual reforms may not match what is currently proposed.

TBC15

This gentleman seems to be just the person who should benefit from the proposed reforms.

I read with interest Snowman’s letter to his MP, and left it at that.

I think that anyone who has a heat felt belief this is where the legislation should go should pause at the keyboard and pen a letter totheir MP to help make it so.

It would be nice at the end of the day to say, “ I did my bit”