SIPP & tax Advice

fjh

I previously posted regarding possibility of moving my Final Salary Pension to a 'SIPP'

But I have Just discovered another 'Option' rather than a) leave Final salary pension alone or b) TF to drawdown I have found I have an option of just 'transfering ' @ £35k in my AVC to a SIPP
As its over 30k I know I need IFA to sign off .
Would I be able to then draw this out of SIPP as part of my 25% tax free ( Final salary Pension TF value is £885K)- this appeals as it would still give me some time to decide if I should TF the main pension to Drawdown
Any suggestions re a good priced SIPP provider would be welcome
Thanks G

kidmugsy

fjh wrote: »

Any suggestions re a good priced SIPP provider would be welcome

At £35k Hargreaves Lansdown would give you a good combo of user-friendliness and cost.

Why is it better to transfer the AVC than to get it all out tax-free when you activate the FS pension? Once it's in the SIPP you'll get only 25% of it tax-free.

fjh

I was looking to just use the AVC if possible for Home improvements etc, still not sure about TF of Final salary and reiterated in 5 years time so still have some time to decide( I accept TF value may alter)
Is it possible to take the AVC as part of the overall 25% tax free then start to draw those funds?

Linton

Each pension's 25% tax free is completely separate. There isnt an "overall 25% tax free". Except in the case of some DB schemes which allow the DB 25% to be taken from the associated AVC. You would need to check what the rules are for your DB scheme.

AlanP_2

Does your main scheme allow you to take the AVC pot fully tax free as part of a (DB+AVC) *25% calculation as if it does paying tax on 75% of it is an avoidable expense?

If you do transfer it and withdraw anything over the 25% tax free you will be hit by the MPAA and limited to £4k annual pension contribution limit?- this doesn't apply to DB pension contributions as far as I understand it.