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Recycling problem

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  • Durban
    Durban Posts: 485 Forumite
    Tenth Anniversary 100 Posts Name Dropper
    This from the HMRC website

    ''Recycling of a pension commencement lump sum involves using that lump sum as the means to increase contributions significantly to a registered pension scheme. The recycling rule is intended to prevent the systematic exploitation of the tax rules for registered pension schemes to generate artificially high amounts of tax relief by using the pension commencement lump sum to make a further, tax relieved, contribution to a registered pension scheme.''

    This is directly from the HMRC website and seems to suggest as AnotherJoe stated that we will indeed be able to do this as , although increasing the contribution hugely , by adding #20,000 to it and then withdrawing immediately the tax relief is added, it is not being used to put back into a pension.
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