income tax/pension pot

tonyd123

not quite sure ..in fact very unsure,, problem ,getting close to that age called about my old pension pot i have decided to take the pot. 25% tax free the rest taxed at rate 20% problem is with my earnings
the rest of the pot will push me over 46000 into 40% tax band ..
how does that work ? do i pay 20% up the higher rate or do i pay 40% on everything i have earned this year approx 32000, hope it works like that ,or does it?
any advice most helpful

calcotti

Take your earnings plus the taxable part of the lump sum.
You get £11,850 tax free.
From £11,851 to £46,350 is taxed at 20%
From £46,351 to £150,000 is taxed at 40%

Do you have an option to take some now and some after 5th April so that you split the sum across 2 tax years? That way you would stay below the higher rate threshold in both years.

tonyd123

the pot was only 22000 i would have liked to take it in smaller pots 3x25
for the remainder but they didnt have this option i would have to swap it out to another company, but as long as i am only going to pay the higher rate on a small part i dont mind so much

tonyd123

ps not 65 until next month and dont have any plans to retire yet although i may stop working weekends lol!!!

xylophone

This old pension is a DC pension?

Are you currently contributing to a DC pension?

If so, are you aware of the MPAA if you take anything other than the PCLS from the old pension?