Bt pension

Leelaw17

Hi I'm 77 and have been receiving a bt pension of 1500 a year I have a total of 37k in my crystallised pot
I asked bt if I could draw a cash lump sum from this
But received a reply stating that the limit was 30k and therfore I'm not allowed to take any money out ??
I could understand if i hadn't paid enough in but on current calculations I would have to live another 5 years before I can take my money out ?( making me 82 ?? )
If I die before I caint benefit from the money I paid in ?
I'm fully aware that I would have to pay tax .. I just want to enjoy the money I put in whilst I was working
Please can you advise ... and I would like to hear if anyone else has had the same problem with a bt pension

xylophone

Hi I'm 77 and have been receiving a bt pension of 1500 a year I have a total of 37k in my crystallised pot

Surely you are in receipt of a DB pension from BT and presumably have been for around 17 years?

What do you mean by "crystallised pot"?

caveman38

Leelaw17 wrote: »

Hi I'm 77 and have been receiving a bt pension of 1500 a year I have a total of 37k in my crystallised pot
I asked bt if I could draw a cash lump sum from this
But received a reply stating that the limit was 30k and therfore I'm not allowed to take any money out ??
I could understand if i hadn't paid enough in but on current calculations I would have to live another 5 years before I can take my money out ?( making me 82 ?? )
If I die before I caint benefit from the money I paid in ?
I'm fully aware that I would have to pay tax .. I just want to enjoy the money I put in whilst I was working
Please can you advise ... and I would like to hear if anyone else has had the same problem with a bt pension

I'm 65 and receive £15,000. Using your figures and seeing that you have received your pension for a number of years. I'd imagine mine must be worth over £300K.
How did you gain access to that figure, as I wouldn't mind a part of mine as a lump sum. I thought Final Salary PS didn't give you that option. I'd be interested in any answers too.

Silvertabby

Hi I'm 77 and have been receiving a bt pension of 1500 a year I have a total of 37k in my crystallised pot
I asked bt if I could draw a cash lump sum from this
But received a reply stating that the limit was 30k and therfore I'm not allowed to take any money out ??
I could understand if i hadn't paid enough in but on current calculations I would have to live another 5 years before I can take my money out ?( making me 82 ?? )
If I die before I caint benefit from the money I paid in ?
I'm fully aware that I would have to pay tax .. I just want to enjoy the money I put in whilst I was working
Please can you advise ... and I would like to hear if anyone else has had the same problem with a bt pension

Am I right in thinking that this is a final salary pension? I'm also going to guess that you asked BT if you could cash it in, and they said 'no' because the notional value of your pension is over the £30K trivial commutation limit. ie - 25 x £1500 = £37500. However, this £37500 isn't your 'pension pot' - it's just the notional value of a final salary pension already in payment, and is only used to determine the triviality limit.

Are you sure that you will lose out if you die before 82? If you calculate how much you have already drawn, and compare that with your contributions, I think you'll be pleasantly surprised. Rule of thumb with the LGPS is that you get your 'contributions' back in just 10 years, so if you retired at 65 you're probably already quids in.

Sorry guys, but once final salary schemes are in payment they can't be 'cashed in' unless the scheme offers trivial commutation under £30K.

Keep_pedalling

Once you start to draw the pension, there is no option to take another lump sum. You don't have a pot, you simply have a guaranteed pension for life.

xylophone

Once you start to draw the pension, there is no option to take another lump sum. You don't have a pot, you simply have a guaranteed pension for life.

As silvertabby points out,under certain circumstances, trivial commutation of a pension in payment is permitted but the full lump sum thus realised would be subject to tax at the rate appropriate to the individual.

I think she is right in her assumption that by "crystallised pot" the OP means the benefit value of his gross annual pension in payment as at 5 April 2006 as here

http://www.pensionsadvisoryservice.org.uk/content/publications-files/uploads/Taking_small_pensions_Detailed_SPOT008_V1.5.pdf

Keep_pedalling

I am assuming the OP is in section A of the BT pension scheme and there is nothing in the rules of that scheme that allow a lump sum to be taken once you are drawing your pension.

Even if it were possible, I would think the amount they could get would be very low as they have already had a lump sum 17 years ago, and 17 years of drawing the pension.

xylophone

It may be that the BT Scheme does not permit TC. There is no obligation to offer it.

The general point being made is that even where a pension has been in payment, TC is still possible under certain circumstances - see link.

In the OP's case, even were TC available from BT, because of the value of the benefits, he would not be eligible.

PensionTech

I'm 65 and receive £15,000. Using your figures and seeing that you have received your pension for a number of years. I'd imagine mine must be worth over £300K.
How did you gain access to that figure, as I wouldn't mind a part of mine as a lump sum. I thought Final Salary PS didn't give you that option. I'd be interested in any answers too.

No chance. You can't take a lump sum from a benefit that size, you can't do anything else with it after you've retired, and you can't split it up to take only part of it as a lump sum. Unless you're prepared to get a divorce...

JohnB47

You mention benefiting from the money you put in. I'm pretty certain that, if you include a lump tthat you probably received when your pension started, you've now received well in excess of the money to paid into your pension. It's all been free money for some years now.