Pension and employment and SE

Nual

I am about to take early retirement/ voluntary redundancy, and have been offered a part time post elsewhere. I have also been offered a bit of freelance work. I am 60.

Have I understood correctly that I can pay up to 8000 net, 10000 gross into a personal pension while drawing my DB pension as long as I earn this much (10k)?

Thanks

xylophone

See
http://www.hl.co.uk/pensions/sipp/how-much-can-i-invest for some helpful information.

https://www.gov.uk/tax-on-your-private-pension/annual-allowance

Your new employer will be offering a pension scheme?

mania112

The normal annual allowance is £40,000 per annum.

The £10,000 limit you're referring to is called the Money Purchase Annual Allowance which is only triggered when you take income from a flexible pension pot, ie, Drawdown.

Your final salary will not trigger the reduction, so if this is your only pension you future contribution limit will remain £40,000 per annum gross (so long as the limit stays as such).

zagfles

If your DB pension pays a PCLS (tax free lump sum) make sure you don't fall foul of the recycling rules https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm133810

Nual

I have just had a look at the recycling link. Complicated stuff! I will have a PCLS as well as redundancy and still need to work out what to do with it.

The part time post is low paid and the freelance work will be very occasional. My pension plus savings will be fine for living on, so say I earn 12k gross would I fall foul of anything if I paid that into a pension? What about if I paid more? If I put say 12k into a pension as a lump sum would that be allowable or would it have to be monthly as my salary came in?

TBH I am only going to do the work as a way to ease into retirement rather than it being a cliff edge.