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Pension contributions and withdrawal for non-taxpayer
joerugby
Posts: 1,180 Forumite
My wife is 63 and is a non-taxpayer
I understand that she can contribute up to £3,600 gross (£2,880 net) to a pension this tax year
When and in what circumstances would she be able to withdraw the whole £3,600 tax free assuming she remains a non-taxpayer?
I understand that she can contribute up to £3,600 gross (£2,880 net) to a pension this tax year
When and in what circumstances would she be able to withdraw the whole £3,600 tax free assuming she remains a non-taxpayer?
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Comments
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Presumably she would pay the £2880 into a SIPP, wait for the tax relief to be added, then withdraw as a small pot - however, the SIPP provider would make a charge for the administration/withdrawal?
You could check it out with the likes of Hargreaves Lansdown?0 -
It occurs to me that the SIPP provider might well deduct tax from the pension on withdrawal which would have to be reclaimed from HMRC?0
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Presumably she would pay the £2880 into a SIPP, wait for the tax relief to be added, then withdraw as a small pot - however, the SIPP provider would make a charge for the administration/withdrawal?
You could check it our with the likes of Hargreaves Lansdown?
or withdraw it anytime after April using the new freedoms.0 -
Presumably she would pay the £2880 into a SIPP, wait for the tax relief to be added, then withdraw as a small pot - however, the SIPP provider would make a charge for the administration/withdrawal?
You could check it our with the likes of Hargreaves Lansdown?
But note that the charge for doing this will remove any benefit. Better to do it each year and then do phased withdrawals when you actually need the money (or lead up to needing the money)I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
If you look at the newly published HL price list for "new drawdown" you'll see that the charges are agreeably modest, except for people who contribute and then withdraw the loot within a year. They get hit over the head with a stinking fish.
"*If you withdraw the full amount in the first year of opening the account, there is a charge of £295 plus VAT. Not applicable to pension transfers out or to clients who held Flexible Drawdown before 6 April 2015."
So cultivate patience.
https://www.hl.co.uk/pensions/income-drawdown/newFree the dunston one next time too.0 -
Thanks guys, much appreciated0
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