lifetime allowance, DB pensions plus SIPP, check my logic?

stoozie1

Hi,

A couple of people have said that they think OH will exceed his LTA with (not huge!) SIPP contributions, but I think he won't, so I just wanted to check with you if our maths/logic is correct.

NHS DB scheme 1 deferred benefits, current annual value: £9292 annually LS: £27878 (total at today's values, to be taken at age 60) total today for LTA purposes: £213,718

NHS DB scheme 2 CARE scheme. Projected value with all payspine enhancements and I've applied a revaluation of 2.5% annually (is this conservative enough?) With contributions having to stop at age 60, but being crystallised at SPA and being revalued til then, annual value £28,880, no lumpsum. Value for LTA purposes: £577,600

total: £791,318

I am assuming that although I haven't applied any revaluation to DB scheme 1, that the promised enhancement of the LTA will compensate for this?

Is it therefore still wise to be paying into the SIPP?

Many thanks.

bigadaj

there's a large number of variables, so probably best modelling different scenarios, initially be doing the revaluation at least at different figures.


Current age and earnings are relevant, enhancement of the lta may occur, but the most recent indications are that it may reduce even further (ie that whats happened over the last few years)?


Higher rate tax relief could be reduced or removed at any point, so a point that suggests contributing currently is worthwhile continuing.


Probably other points to consider as well.