Paying £2880 into pension when retired

topcat105

Thank you AlwaysLearnin
That is very useful.
Why couldn't HL have told me that ??

drumtochty

Yes the first time you take a payment HL would want some proof of identity which they then keep on record.

Then you do the risk anaysis questionsaire via their website or on the phone or you can request a paper questionaire for the risk analysis.

HL then send out a form to fill in to transfer the funds from the SIPP to your drawdown account,  on the form you then advise them that you want the tax free amount and what amount of drawdown you want to take either monthly or in a lump sum.

In the case of one person, that I assist with this, she take the tax free amount every year and approx £1,950 a year of drawdown as her state pension and a small works pension is £1,950 short of her personal allowance. After her 75th birthday she will have say another 5 annual payments to exhaust her SIPP depending on what funds are added to her investments over the years.

After the first time you take a payment it is a case of doing the risk analysis questionaire and filling in the withdrawal form a few months after you pay in your annual pension contribution and the tax relief is gained.

Yes you have to do these two actions annually.

blackreddennis

I have gone through the same process as a non tax payer making £720 by using the system, however beware, you can only do this three times in different financial years as they are deemed to be closures of small pensions. Each small pension can add up to under £10k.

Rob749

blackreddennis said:

I have gone through the same process as a non tax payer making £720 by using the system, however beware, you can only do this three times in different financial years as they are deemed to be closures of small pensions. Each small pension can add up to under £10k.

Hi,
Just to clarify, If you still have the SIPP open, i.e. there is still £1000 or more in the account, surely it can't be deemed as a closure of a small pension?

peteduk

blackreddennis said:

I have gone through the same process as a non tax payer making £720 by using the system, however beware, you can only do this three times in different financial years as they are deemed to be closures of small pensions. Each small pension can add up to under £10k.

Hello,
Please can you advise where you read this?
Unless I mis-remember most people in this forum advise it can be repeated until 75. Or is it something related to the withdrawl method?
Thank you

TBC15

blackreddennis said:

I have gone through the same process as a non tax payer making £720 by using the system, however beware, you can only do this three times in different financial years as they are deemed to be closures of small pensions. Each small pension can add up to under £10k.

Are we sure about this ?

NedS

blackreddennis said:

I have gone through the same process as a non tax payer making £720 by using the system, however beware, you can only do this three times in different financial years as they are deemed to be closures of small pensions. Each small pension can add up to under £10k.

I think you are talking about the small pots rule, whereby you can take up to 3 small pensions worth up to £10,000 each without triggering the £4,000 MPAA limit, thus not limiting the amount you can further contribute to pensions. For what most people here are discussing, this is not a factor as they are only considering contributing £3,600 per year (limited by lack of earned income), so below the £4,000 MPAA limit.

where_are_we

blackreddennis said:

I have gone through the same process as a non tax payer making £720 by using the system, however beware, you can only do this three times in different financial years as they are deemed to be closures of small pensions. Each small pension can add up to under £10k.

We have been doing this since George Osborne`s pension reforms in 2015. We use annual UFPLS lump sum withdrawals and done it at least 4 times. The HL SIPP is kept open so there is no closure of the pension.

solar_power

Hi all, I keep a buffer of £1000 in my SIPP and have just added the yearly £2880. Is it ok to pull out £3600 before the tax relief is added in June?

Audaxer

solar_power said:

Hi all, I keep a buffer of £1000 in my SIPP and have just added the yearly £2880. Is it ok to pull out £3600 before the tax relief is added in June?

I don't think you can take it out until the tax relief has been added. Even if you could, it would put your balance under £1,000 until the tax relief was added, and therefore possibly risk the SIPP being closed.