Taking Pension out

frankraz

Dear All

I have two pension pots with Fidelity and Standard life from my previous employers. As I have left those employers and I was not there for long there isnt that much in them. I am now currently working in Public sector and my current pension provider does not allow transfer ins. I wanted to know when I reach 55 (next year) can I take these pensions out even though I will still be working at my current employer. Will this be allowed?

Thanks

xylophone

Neither of these pensions have safeguarded benefits valued in excess of £30,000?

If basic DC pots you should be able to access them if you wish.

https://www.pensionwise.gov.uk/en

Don't forget to consider the tax implications of taking more than the PCLS from each.

AnotherJoe

How much are we talking about? How much do you earn. No point taking it out in one fell swoop if it means a big tax loss.

P.s this is important. If yiu take out even 1p more than the 25% tax free lump sum you are then forever restricted from putting in more than £4K to a pension. That might affect your current pension.

hyubh

AnotherJoe wrote: »

If you take out even 1p more than the 25% tax free lump sum you are then forever restricted from putting in more than £4K to a pension. That might affect your current pension.

The MPAA only affects future DC contributions - presumably the current pension is DB, given public sector...?

Marcon

Wonder if OP has been able to follow all the jargon and abbreviations...? If not, do shout!

frankraz

Dear All

Thank you all for your advice. Im not sure what DC and Db means. Apologies as I really do not understand pensions as they are very confusing. My two pots are in Private sector one with Fidelity for £25k and one with Standard life worth 5k. I am sure they were Salary Sacrafices. I know first 25% is tax free, I just want to know can I take them out or the tax makes this not feasible when I am 55, or do I wait until im 60

MallyGirl

The tax implications would be the same at 55 or 60 unless you retire at 60 as well.
The £4K limit may not be applicable to you but it is worth confirming that with your current HR department.
If you take anything more than the 25% tax free bit then what you withdraw (on top of the 25%) will be added to your salary and will be taxable. If you are ever likely to be in a defined contribution pension (normal one where you and employer pay an amount into a pot) in the future then taking above the 25% will limit annual contributions to £4K so you might miss out on future employer 'free money'

frankraz

Thank you for making this clear for me. I appreciate the help and advise

atush

The 25K one is likely to put you into HRTax even if the 5K one doesnt.

Do you need the money? OIf not, best to leave it there. Esp as if you wanted to retire before your Public sector pension pays out in full 9;ikley 67 for you) then you could use those 2 pots to live on.