Taking first UFPLS from a small Hargreaves Lansdown SIPP

bowlhead99

To avoid taking the long "£2880 into pension when retired" thread into more sidetracks on specific providers...

Mum's SIPP was set up a couple of months ago so the £720 tax relief on her £2880 contribution has not yet been received but is due to be credited later this month. Not a problem as only looking to take out about £2500-2600 total this tax year via UFPLS and leave £1k in the account, putting more in next tax year up to the annual limit for non earners. She already has online access to it alongside her ISA and can see the cash in the account.

First step was to go to the HL page for 'taking lump sums' and fill the form to request an info pack "The pack will explain UFPLS in more detail and also include details of how to apply. Request your copy today by completing your details"
Then presumably the pack tells you how to do it.

Dad reckons he's received a couple of packs/forms in the post today after doing that: one seems to be for setting up a SIPP and opening an account, giving them ID documentation etc - presumably irrelevant as the SIPP is already established ; another explaining the process for Drawdown etc.

One form is headed "priority request: retirement options"; below the simple stuff like name, address etc on that form there's boxes for 'pension details for annuity and drawdown options : value / expected retirement date / how much tax free lump sum would you want' ; then it goes on to 'please post me: more details on annuities inc an annuity quote / more details on drawdowns inc a personal illustration / more details on lump sums (UFPLS pack)'.

Then there is a separate white form "What next: risk factors to consider when taking a lump sum (UFPLS) from a pension" - which is basically a questionnaire on whether you have had advice, do you understand this, that, and the other risk factors around taking lumpsums. At the bottom of the risk questionnaire it has "thank you now return the form in the prepaid envelope or call us on xxxx ;" and space for an email address in "send my application by email".

As I'm attempting to field his questions without the forms in front of me (because they came through post rather than electronically for easy sharing) -I am not sure if the first form might not be needed (we do just want a UFPLS application pack, which is why we filled out the online application for a lump sum information pack...) and the second form sounds like the key one to sign off on the risks so they will send the application form through. But perhaps the first form I described is needed to act as a covering letter for the UFPLS risk questionnaire to be sent to them and then they will fire out another form.

The idea is not to take money out via drawdown (as we are out of time this tax year for anything to go month by month) but just to grab (say) £2600 of the soon-to-be £3600 in the SIPP and take it out using the standard 25%/75% taxfree / taxable split.

I wasn't sure if this is just the first bit of a lengthy process to put in some details and get an illustration and then eventually be able to click some buttons online to extract cash, or whether the next form that follows will be the proper application to send off in the post again to extract cash, or whether there should already be another piece of paper in the pack at this stage to actually constitute a request for a UFPLS of £x to be sent to the registered bank account.

I had suggested they try to do this earlier in the year to avoid missing the cutoff to get a payout close to the 2016/17 deadline (having heard that drawdowns are paid on the xth of a month and need to be requested by the yth of the month), but we are where we are. My hope is that a one off UFPLS - as distinct from a regular ongoing drawdown - is something that can be done on an adhoc basis before 5 April if HL were to get the current batch of forms by early next week and then if necessary, the formal application the week after.

The timeline is compressed a bit as they are travelling away for a week from first thing monday. I wasn't sure if perhaps they can do the questionnaire over the phone, then get the proper application form over email, then get that sent in first thing Monday and have a better chance of getting the cash through to count as 2016/17 income.

Any other experiences or comments about whether I'm on the right track would be handy. I know how UFPLS works and all the tax consequences, it's just the process with this particular provider.

Thanks

Jerben

My partner did something similar to this with HL recently.
(We didn't do any of the download and form filling you describe).


She just rang them. (it was answered quickly by someone who spoke perfect English!), and said 'I'd like to take a UFPLS from my SIPP for a total value of £xxxx'.
Reply was 'thank you that's fine'.


A few security questions and a few days later... 'job done!' The money was in the bank.
(They did take some income tax, but we filled in a form with HMRC and got that back a couple of months later).

bowlhead99

Hmm, that's the outcome I'm hoping for so that's reassuring.

The problem with mum (whose ISA it is) phoning is that she doesn't really know what a UFPLS is, or the details of why she set up a SIPP, other than it was recommended by me as the right thing to do due to the great tax benefit and zero downside risk; dad sorts their finances and set up their ISAs and recently mum's SIPP with HL but is basically just following instructions from me on the latter; and I don't live in their house or have authority to speak to financial services providers for either of them!

Still I guess this is where HL's well regarded customer service team steps in and earns their 0.45% on the remaining £1000 invested capital by having a 3-way phonecall!

I was just thinking the paper route would be the 'path of least resistance' if anyone had tried that recently and found it straightforward.

Nationwide8

This is interesting as my first £720 is due to be added to my SIPP by 21st March ( it's not there yet ) and then as discussed in the other thread I want to take out 25% tax free ( £900 ) and then for various reasons £1700 ( taxable probably even though this doesn't take me over PA for 2016-2017 ) before this tax year ends,leaving £1000 in there.

So it's not as easy as clicking a few buttons to move amounts into a bank account ? Better to telephone HL ?

TBC15

Wish I’d known about the do it over the phone bit as we went down the request forecast/ request drawdown route and there is no chance of fitting it all in before the end of the year.

Jerben

bowlhead99 wrote: »

Hmm, that's the outcome I'm hoping for so that's reassuring.

The problem with mum (whose ISA it is) phoning is that she doesn't really know what a UFPLS is, or the details of why she set up a SIPP, other than it was recommended by me as the right thing to do due to the great tax benefit and zero downside risk; dad sorts their finances and set up their ISAs and recently mum's SIPP with HL but is basically just following instructions from me on the latter; and I don't live in their house or have authority to speak to financial services providers for either of them!

Still I guess this is where HL's well regarded customer service team steps in and earns their 0.45% on the remaining £1000 invested capital by having a 3-way phonecall!

I was just thinking the paper route would be the 'path of least resistance' if anyone had tried that recently and found it straightforward.

OP. My partner didn't know what a UFPLS was either!!
Yes they gave her the 'do you understand that 25% is tax free....etc...'
I told her to just say 'yes' and 'no' in appropriate places, and if she didn't understand what the HL person was talking about, just repeat the 'I'd like to take a UFPLS from my SIPP...' sentence again.
It all went easily and smoothly.

coyrls

I’ve have just made my first “one-off” withdrawal from an Alliance Trust Savings SIPP. I quickly learned that all the forms and processes are set up assuming that you want to take a regular income from your SIPP. I had to send a letter requesting a one off payment, which then went through (after a couple of hiccups in their systems). So it does seem that the forms and processes have not caught up with the concept of “flexible”.

digannio

I have done this twice with HL, in June 2015 and June, 2016, in each case withdrawing £3,600 after depositing £2,880 into the cash account in my SIPP and this is how it worked for me.

I ran through the simple risk questions over the phone (you can also send the form back through the post) and then was sent an application form detailing how much I wanted to withdraw etc. I sent this back and the money came into my nominated account within a few days.

At the time of my last UFPLS there was no arrangement in place for them to just transfer the money over after a telephone request. Running through the risk questions and filling in the subsequent application was the only way to do it. Maybe that's been simplified more recently but the above is my experience of it so far. Guess I'll find out in June when I do it again.

My UFPLS payment was taxed and I just claimed that back from HMRC straight away.

Hope this helps.

moneyfoolish

Does anybody know whether HL will discuss any questions re my wife's SIPP with me by telephone if she gives permission?

zagfles

moneyfoolish wrote: »

Does anybody know whether HL will discuss any questions re my wife's SIPP with me by telephone if she gives permission?

Can't see why not. Never tried with HL, but have done with all sorts of other organisations inc banks, HMRC, and for my mum too. She calls, goes through security, and then asks them to speak to me.

And as HL allow people to give other people full access to their online account (via linked accounts) can't see why they wouldn't on the phone.

Nationwide8

digannio wrote: »

I have done this twice with HL, in June 2015 and June, 2016, in each case withdrawing £3,600 after depositing £2,880 into the cash account in my SIPP and this is how it worked for me.

I ran through the simple risk questions over the phone (you can also send the form back through the post) and then was sent an application form detailing how much I wanted to withdraw etc. I sent this back and the money came into my nominated account within a few days.

At the time of my last UFPLS there was no arrangement in place for them to just transfer the money over after a telephone request. Running through the risk questions and filling in the subsequent application was the only way to do it. Maybe that's been simplified more recently but the above is my experience of it so far. Guess I'll find out in June when I do it again.

My UFPLS payment was taxed and I just claimed that back from HMRC straight away.

Hope this helps.

It does help !! and all interesting posts !!

If you drew out the £36000 hopefully just £2700 was taxed ? as £900 ( 25% ) is tax free.

Was going to withdraw two separate amounts £900 and then £1700 ( leaving £1000 in the SIPP ) but sounds easier to withdraw £2600 in one go if I want it to happen in this tax year ( am assuming only £1700 of that would be taxed ?? )

Can someone Remind me again what UFPLS stands for ?