Total tax free lump sum from two pensions

klaatu

I am taking early retirement later this year at age 57. I have two pensions, the first is a final salary scheme which was closed to contributions a few years ago, to be replaced by a DC scheme. The pot for the latter will be about £50k.

I want to take a tax free lump sump of £50k. The statement for my final salary scheme says I can take a lump sump of up to £57k. Presumably I am also entitled to a TFLS of approx £12500 from the DC scheme.

What I would really like to do is take the entire DC pot as a TFLS, and zero from the final salary scheme. I am sure that I have read that in some circumstances, such as the case where a DB scheme has closed and replaced by a DC scheme, HMRC will regard multiple pension pots as a single pot for the purposes of the TFLS, and thus allow me to do what I want to do without paying tax on the lump sum. I am currently unable to find any references to this, and I can't remember what the name is for this.

Am I correct in thinking that such a scheme does exist, and if so, is there a name for this? To get official confirmation that I can take my entire DC pot tax free, do I contact HMRC about it, or my employer's pension department?

Steve

greenglide

You need to ask the pensions administrators. Some schemes will allow this and have this in the rules, some dont. Nothing to do with HMRC.

The scheme doesnt have to do this if they dont want to if it is not in the scheme rules. You need to read the scheme booklet.