semi -retirement money problem

jan12345_2

Hi - would be grateful for any advice. I need to take early retirement from NHS (age 59 years 5 months!) and will have approx. £500 per mo. pension plus £21000 lump sum. I intend to work on an ad-hoc basis for the nurse bank, will I be taxed straight away on that income? I have no other income, the lump sum will be needed to top-up my pension when I can't work - caring for elderly relatives. :A

mgdavid

the lump sum is tax-free.
The £500/mth pension is added to whatever you earn to give a total income. Against the total income is set your annual tax allowance of £10500 and you pay tax on the difference.

Wilkins

Unfortunately, you may find that HMRC will assume that you have started another job and deduct tax at the standard rate from your £500 per month. However, if that is the case, a phone call to your tax office should sort it out.

HOWMUCH

You can earn £10,000 per year tax free have you got the uniform washing allowance, shoes, tights allowance, rcn tax relief added to your tax code? this will give you a higher tax code. Will you be banking for the same trust? if so then why not apply for your tax code to be split between pension and earnings.

atush

Ae you working now? Waht is your retirement date? do you have savings and investments?

It could be worth, before you stop work full time, to pay into a DC pension. Where every 80/800 you can spare could be made up to 100/1000. Which could give you a little sum to tide you over, if not for a year, maybe the 7 months to age 60?

Thrugelmir

In the old scheme it's optimal to remain until your 63, i.e. past the NRA of 60.

Have you asked to work reduced hours?

jan12345_2

Thanks so much for all the information - really appreciated. I intended to stay on a permanent contract until well after 60 but couldn't drop my hours - after battling with management for months gave in and will retire. Have a big hole in NHS pension as I worked abroad for many years! :A

Notfarfromtheborder

Hi Jan

No chance you could find a different reduced hours contract within the NHS, maybe different employer that sits under the NHS umbrella and then quit your current job?

jan12345_2

Notfarfromtheborder wrote: »

Hi Jan

No chance you could find a different reduced hours contract within the NHS, maybe different employer that sits under the NHS umbrella and then quit your current job?

Hi - Because of my age (shouldn't be a factor but surely would put employers off!) :Aand the fact that I need to have extra time off now, to care for my elderly parents, that's not possible. I should have enough income from nurse-bank work, at the hospital where I'm employed.

Thanks again

sleepless_saver

Have you considered checking your eligibility for carers allowance and income support (as a carer) if you were not working? That would also passport you to other benefits e.g. housing benefit and council tax reduction and possibly allow you to leave your pension untouched till scheme pension age. You can check using this calculator.