Taxation on 25% SIPP drawdown

Deneb

ProDave wrote: »

Thanks for the clarification. The form I have just filled in and posted to HL suggests just drawing the 25% TFLS limits mr then to £4K pa contributions.so a bit misleading.

Are you sure? Mine referred to taking income triggering the MPAA, in the declaration, which is correct. You aren't taking income if you are only taking the PCLS. Presumably you ticked the relevant box in section 5 to say that you did not wish to take any income at this time?

Rheumatoid

caveman38 wrote: »

Not a Maths Teacher then?

Eh? 56 now. Retire 58. 2 year gap to NPA. No, not a maths teacher

Mnd

I agree with Denby and westv above, I have also asked for advice on these boards and from Hl and I understand that as long as you only take the TFLS and no taxable money, even if you don't pay tax, they you will not trigger the MPAA

Mnd

https://forums.moneysavingexpert.com/discussion/5786102

Read this. Comment from Linton.
I hope I'm right as we've done exactly this with part of my wife's pot, with a view to stoking it back up when I get my state pension in 2 years.

https://www.moneyadviceservice.org.uk/en/articles/change-to-mpaa

This makes it pretty clear I think

caveman38

Rheumatoid wrote: »

Eh? 56 now. Retire 58. 2 year gap to NPA. No, not a maths teacher

My sincere apologies. Misread post. Egg on my face although I wasn't trying to be nasty just witty. Sorry again.

Rheumatoid

caveman38 wrote: »

My sincere apologies. Misread post. Egg on my face although I wasn't trying to be nasty just witty. Sorry again.

No problem. Having lectured radiation physics to a reluctant audience for many years I am immune to being abused. I also picked up some maths on the way

pensionpawn

Are you allowed to take your TFLS from one of your pension pots and immediately dump it into another of your pensions pots with the 20% tax rebate topping it up?

AnotherJoe

pensionpawn wrote: »

Are you allowed to take your TFLS from one of your pension pots and immediately dump it into another of your pensions pots with the 20% tax rebate topping it up?

Yes and no.
There is a £7,500 recycling limit and I think you are safe within that.

Its always seemed to me it would be safer to do it the other way round even though it comes to the same thing. Take the money from savings or wherever, put it in pension, later on replenish from TFLS. Still, £7,500 is, IIRC marked as a limit by HMRC even if its clearly been recycled. AFAICR that is.

You are of course still restricted in any even to the maximums of earnings, £40k, £10k, £4k, £3,600, depending on your situation

pensionpawn

AnotherJoe wrote: »

Yes and no.
There is a £7,500 recycling limit and I think you are safe within that.

Its always seemed to me it would be safer to do it the other way round even though it comes to the same thing. Take the money from savings or wherever, put it in pension, later on replenish from TFLS. Still, £7,500 is, IIRC marked as a limit by HMRC even if its clearly been recycled. AFAICR that is.

You are of course still restricted in any even to the maximums of earnings, £40k, £10k, £4k, £3,600, depending on your situation

Thanks for that. I'v also just read that there is a 30% uplift in annual contributions trigger too!

pensionpawn

pensionpawn wrote: »

Thanks for that. I'v also just read that there is a 30% uplift in annual contributions trigger too!

So would an increase from £1700 to £7500 pa arise suspicion? Not exceeding the recycling alarm threshold however over 4 times the previous contribution level?

Not trying to be naughty, just trying to establish what we are allowed to do!