Pension Pot

Ceres1

'Your Hero: The question has already been answered my friend. It's a Yes and No scenario. YES, you can take the tax-free 25% now, and leave the remainder fund untouched until next April. But NO it's unlikely that you can do this with your current pension provider in my experience.


You will probably need to transfer your pension to a new provider who can activate drawdown for you. There may be other complications though, such as exit fees, or as other users have pointed out you may be forgoing valuable guarantees within your pension (apologies if you have already clarified if there aren't any, I have not read through all the posts).


Does this make sense?'


Yes it does make sense. Thanks for that I've checked and it would seem that there are no valuable guarantees linked to the pensions. I'll make enquiries with the companies (Prudential and Capita) with regard to drawdown and see how I get on. If they can't help I wont be transferring my pension to a new provider as I reckon I'd be better off waiting for another 10 months or so ... to next April ... to avoid any complications.

When I get some news I'll post here.

Once again many thanks to everyone who has taken the time to contribute to this thread :beer:

Ceres1

Hi All

Just to let you know, and finalise my post, I contacted the two providers and was told I could access 25% of each pot, now, but would have to choose one of their 4 options (annuities) relating to the balance of pension pot money.

I asked about transferring the money elsewhere but was told they weren't in a position to discuss that. One provider suggested I check unbiased.com

I'm just leaving it for now and will see how things unfold between now and next April.

atush

unbiased is how to find a local IFA if required.

Your_Hero

Ceres1 wrote: »

Hi All

Just to let you know, and finalise my post, I contacted the two providers and was told I could access 25% of each pot, now, but would have to choose one of their 4 options (annuities) relating to the balance of pension pot money.

I asked about transferring the money elsewhere but was told they weren't in a position to discuss that. One provider suggested I check unbiased.com

I'm just leaving it for now and will see how things unfold between now and next April.

Thanks for the update. That was as expected.


Probably a good idea to wait until April but I'm not convinced that all providers will build this drawdown facility into their systems (very costly) so you may need to transfer your pension anyway.


It will of course be possible to drawdown in full from next April but I can't see that the providers will be obliged to provide it and may just urge you to transfer it to another provider who can do it. Similar to the fact that you can legally withdraw your pension in full right now ("unauthorised payments") but subject to a 55% tax charge, but no major providers allow this.

Ceres1

Your Hero: Thanks for the update. That was as expected.


Probably a good idea to wait until April but I'm not convinced that all providers will build this drawdown facility into their systems (very costly) so you may need to transfer your pension anyway.


It will of course be possible to drawdown in full from next April but I can't see that the providers will be obliged to provide it and may just urge you to transfer it to another provider who can do it. Similar to the fact that you can legally withdraw your pension in full right now ("unauthorised payments") but subject to a 55% tax charge, but no major providers allow this.



Well I'm not willing to pay 55% tax which is an absolute disgrace if you think about it :mad: It makes you laugh when you get told that you save tax on pension savings that is until you decide to do something with it.


No doubt the providers will be looking for their 'cut' of the money for so called exit fees and then more money to be doled out for 'laundering' my money at the other end


Time they did something about the greed of some in this country. It doesn't surprise me to hear that the High Pay Centre study highlights that ''We need to be more concerned about inequality and how prosperity is shared. The rich are richer in the UK than many other countries hiding the fact that the poor are poorer with the lowest 20% in this country having an average disposable income of just £5,506 – the poorest in western Europe... bearing closer resemblance to the under-classes of Slovenia and the Czech Republic than anything to be found among Europe's economic powerhouses. Simply, for the millions of people comprising the poorest fifth of our population, life is much worse here than it is for the poorest fifth in virtually every other north-west European country - countries we would like to think of as our equals. Most people think our living standards in the UK are similar to economies like France and Germany, but being poor in the UK is more like being poor in the former Soviet Bloc than in Western Europe." :huh: :embarasse


I'm seriously thinking of lifting all of my money next year, selling my house and emigrating

kidmugsy

Oh do stop whinging. You are probably one of the 10% richest human beings who has ever lived.

atush

Well I'm not willing to pay 55% tax which is an absolute disgrace if you think about it It makes you laugh when you get told that you save tax on pension savings that is until you decide to do something with it.

You have this wrong. A pension is NOT a savings acct, and you open one in the full knowledge it is for retirement- not for splurging today. So you get things like Tax relief and employers contributions and tax free growth.

the 55% tax charge for taking it early (or others taking it out of pension after you die) is basically getting the tax back.

But given you can take it at 55, 25% tax free and the rest as income or your spouse and dependants can take it as a tax free lump sum if you die before then, and a spouse can have it tax free as their pension if you die after taking it in drawdown- I am really not understanding what exactly you are whinging about?

Ceres1

You’re right Kidmugsy I am one of the riches human beings who has ever lived .............. :j :rotfl: :rotfl: :j


Atush I’m not whinging (complaining peevishly). I’m just out and out complaining (normally) about the greed of charging UK pensioners tax at a level of 55%. It’s a disgrace and the changes are long overdue. I’m also just pointing out in my last post that 20% of the UK population can hardly afford to survive … feed themselves.. due to the rapacious desire of a few in this country to acquire excessive levels of material wealth to the detriment of millions. It's disgusting :mad:


Anyway I’ve decided to take my money, bail out of the UK :wave:, and go lie in the sun somewhere (with lower taxes) whinging away to my hearts content :laugh::cool2::laugh:

atush

Ok, complaining peevishly is something we all do

about the greed of charging UK pensioners tax at a level of 55%.

But, pensioners are not charged 55%.

Non pensioners who take their money out are, and those who choose to take cash from t he pension pot of a relative are (instead of leaving it in the pension tax free in many cases).

So be peevish about things you should do (such as IHT threshold not being raised for years) sharing of tax allowances in married couples etc

jamesd

Ceres1 wrote: »

I’m just out and out complaining (normally) about the greed of charging UK pensioners tax at a level of 55%. It’s a disgrace and the changes are long overdue.

The only pensioners who pay that are the ones who break the rules to get an unauthorised - meaning illegal - payment from a pension pot. Otherwise it's just normal income tax, complete with personal allowance that may mean no income tax to pay on all or some of the 75% that's taxable.

Ceres1 wrote: »

I’m also just pointing out in my last post that 20% of the UK population can hardly afford to survive … feed themselves.. due to the rapacious desire of a few in this country to acquire excessive levels of material wealth to the detriment of millions. ... The rich are richer in the UK than many other countries hiding the fact that the poor are poorer with the lowest 20% in this country having an average disposable income of just £5,506 – the poorest in western Europe.

So lets look at how true the text you quoted in the earlier post is, using the OECD Better Life Index itself, data for the lowest 20%:

UK: $9530
Ireland: $9023
Italy: $8616
Spain: $7144
Portugal: $6870
Greece: $6378
Slovenia: $9138
Slovak Republic: $7830
Czech Republic: $8376

So what we see from that real information is that the text you quoted contains the false claim that the UK's lowest 20% in income adjusted for cost of living is the lowest in Western Europe when it's actually higher than at least five Western European countries that are not normally considered backward: Ireland, Italy, Spain, Portugal and Greece.

But there's more to it than that because "The cost of living is taken into account in income and wealth figures as the reported values are adjusted by Purchasing Power Parities (PPPs). PPPs reflect the differences in cost of living". But your source did not mention that adjustment in its quote.

The reason Slovenia, the Slovak Republic and the Czech Republic look fairly good is that the cost of living in those countries is lower, so that inflates their adjusted income levels.

You need a more reliable data source, one that does not make false claims to make its point and ideally one that also doesn't hide from you the fact that cost of living adjustments are why some countries look better than expected.

Are you unhappy that about 10% of the British population are millionaires? Who do you think those people are and do you think it's fair or right that they are millionaires?

What percentage of all income tax paid by everyone in the country do you think would be fair for the top 1% and top 10% of income people to pay? Maybe you think that the top 1% of income people should pay 10% of all income tax? Or 20%? Or what percentage do you think would be right?

A certain percentage of the population receive more in benefits and such than they pay in tax. What percentage do you think that is? 10%? 40%? 50%, 60%, 90%? Something else?