another LTA question

aldershot

I'm banging up against the LTA. No chance of protection as I've been contributing since 2016.

I'm just about to move the first pot from my HL SIPP to drawdown. I need to wait until after the 21st March as that's when the tax relief from my final contribution goes in.

Am I correct that the LTA rises from £1.03m to £1.055m on the 6th April, so I should ask them to wait until the 6th before making the move? Seems worth having the extra £25k for the sake of a couple of weeks. I don't need to take any income in this tax year as I've already used my allowances.

And am I correct that % of the LTA consumed by a BCE is rounded down to the nearest whole %? The amount I'm shifting is roughly £570k (depending on markets between now an then) but as I want to keep the account open anyway, I was thinking it makes sense to move £569,500 as this is 53.98% of 1055000 and so will be rounded down to 53%. It seems daft to move 54.02% and use up a % point of the LTA at this moment. That 1% would free up £11-12k of investment in the future when I make my next BCE.

Thanks

marlot

You could still qualify for individual protection 2016 if you were over £1m at the time.



My certificates are all to two decimal places.

EdSwippet

aldershot wrote: »

Am I correct that the LTA rises from £1.03m to £1.055m on the 6th April, so I should ask them to wait until the 6th before making the move? Seems worth having the extra £25k for the sake of a couple of weeks.

That's my understanding also. You might as well have the higher LTA allowance if you have the option.

aldershot wrote: »

And am I correct that % of the LTA consumed by a BCE is rounded down to the nearest whole %?

I don't think so. From HMRC's Pensions Tax Manual:

The percentage expressed on the statement should go to two decimal places (i.e. 25.55%). This should be a rounded down figure, so 25.558% becomes 25.55%.

aldershot

EdSwippet wrote: »

That's my understanding also. You might as well have the higher LTA allowance if you have the option.


I don't think so. From HMRC's Pensions Tax Manual:

Thanks Ed. I knew I had read of rounding somewhere but that clears it up. I'll stop trying to finesse it then, but I will wait until 6th April.

aldershot

marlot wrote: »

You could still qualify for individual protection 2016 if you were over £1m at the time.

Sadly I don't as I wasn't.