How to cash my pension in ?

Floyd999

Looks like it would cost me a £295 plus vat fee to HL too ...

xylophone

Looks like it would cost me a £295 plus vat fee to HL too .

Only if you closed the SIPP in the first year - why would you wish to take the tax hit in doing this?

http://www.ftadviser.com/2015/03/23/ifa-industry/companies-and-people/another-provider-unveils-post-april-pricing-ANAJUYHMqJQJydqxvKaxEJ/article.html

jamesd

kidmugsy wrote: »

No it isn't; it's taxed as part of your income.

Taxing at marginal rate is the same as being taxed as part of your income, but it's wording that is more likely to confuse people who don't know that's what it means.

Floyd999

xylophone wrote: »

Only if you closed the SIPP in the first year - why would you wish to take the tax hit in doing this?
l

I don't want to take a tax hit ... It was if I needed all the cash for a emergency ...
I posted the question then found the answer myself after looking at the terms and conditions
Floyd

jem16

jamesd wrote: »

Taxing at marginal rate is the same as being taxed as part of your income,

No it isn't I'm afraid.

My marginal rate is 32.5% at present. However if I were to receive more pension income it would be taxed some at 20% and possibly some at 40% depending on the amount.

jamesd

Then your marginal rates would be 20% then possibly 40% depending on how much extra income you received. It's something MSE explains here.

I still don't like the use of "marginal rate", though. Much prefer just "taxed as income" or similar.

atush

Reported for spam

jem16

jamesd wrote: »

Then your marginal rates would be 20% then possibly 40% depending on how much extra income you received. It's something MSE explains here.

Thank you james. However that article explains marginal income tax bands and not marginal tax rate which is a totally different thing.

Basically the definition of marginal tax rate is - "In simple terms, the tax rate an individual pays on one additional pound of income."

That's why, for me, my marginal tax rate is 32.5%, which as you know, is not an income tax band.

However rather than explain it all again, from post 23 on this thread should help clarify it for you.

https://forums.moneysavingexpert.com/discussion/5256577

I still don't like the use of "marginal rate", though. Much prefer just "taxed as income" or similar.

Yes I totally agree as it seems to be being used wrongly by a lot of people.

atush

jamesd wrote: »

Then your marginal rates would be 20% then possibly 40% depending on how much extra income you received. It's something MSE explains here.

I still don't like the use of "marginal rate", though. Much prefer just "taxed as income" or similar.

Surely you have better things to do than bring up the Aegeus v kidmugsy argument?

jamesd

jem16 wrote: »

Basically the definition of marginal tax rate is - "In simple terms, the tax rate an individual pays on one additional pound of income."

If you want the meaning that you appear to be wanting you'll need to change your chosen definition and/or interpretation to "the tax rate an individual pays on their highest pound of income" rather than on "one additional Pound of income". Unless, I suppose, you happen to prefer to have as your marginal rate a rate that you pay on none of your income.

jem16 wrote: »

from post 23 on this thread should help clarify it for you.

https://forums.moneysavingexpert.com/discussion/5256577

All that's doing is explaining how kidmugsy wants others to use the term.

atush wrote: »

Surely you have better things to do than bring up the Aegeus v kidmugsy argument?

I wasn't aware until this topic that kidmugsy was trying to get others to use it only in the way kidmugsy likes.

Since I've long been aware of the differing usages I just avoid the term much as I'll write combustible or non-combustible rather than inflammable, depending on which of the meanings of inflammable I intend. At least it's now no longer usually necessary to say whether a billion is a thousand million (US) or a million million (traditional UK).

Maybe eventually there will be universal agreement about whether the marginal rate is:

A. the rate on the last Pound of income received
B. the rate on the next Pound of income that will be received
C. the rate or rates on each additional pound of income (the MSE article meaning)
D. something else

I suggest that anyone reading this also discourages use of the marginal rate term given the widespread variation in interpretation and usage.