Amalgamating DC pots should I?

theboots

After my wife was made redundant in 2016 I resigned my job too and we effectively retired early but did not draw on any pension. We both had a house and we moved abroad with both houses being rented out and the resultant income being used to rent a property here (Malaysia), hers was rented whilst we were in the UK so has had tenants since 2011. I did do just under 2 years of ad hoc contract work for my previous employer supporting a legacy product mainly in India through my own limited company but that did not contribute either to my NI or any pension. We are/were both slightly short on our NI contributions her by 2 years me by 4 years, that's being rectified via monthly DD since 1 year ago so eventually we should get the full state pension at 67.

We're both currently UK tax resident, I left mine since my company was in the UK and my wife since her sole current income is her rental property, she is not a UK citizen but had lived in the UK since 1975. I don't think it makes sense to tell HMRC we no longer wish to be tax resident unless we sell our properties at least that is the advice I have been given up to now. We'd meet the criteria for sure, I last visited the UK for my contract in April 2018 and my wife has not returned since we left in 2016.

I reach 60 this October and will automatically get a partial BT DB pension from my work for them up until 1995. Whilst I was with BT I also contributed to a Standard Life FSAVC, current value is around £28,000. When I had my chat with the government pensions advice line last year the advisor suggested that I could take that as part or all of the 25% tax free and leave a greater sum with BT to increase the pension - now that the time has come (I've received my choices pack from BT) neither BT or Standard Life seem au fait with a mechanism for doing this, unless I switch the FSAVC into the BT pot, if I'd been aware I could have done this last year, however, when I spoke to both parties then they both said it was possible to do what the advisor suggested without mentioning switching.

I have a couple of pots from personal and company schemes with Aegon and Mercer which are DC and a further DB scheme with Mercer that pays out at age 65

Anyway that got me thinking I would/should amalgamate my other various DC pensions into a SIPP so that if needed I can draw now. I think although I could be persuaded otherwise that ad hoc drawdown will be my best option as we already have a regular income from the rentals and only occasional top up maybe required, Mercer for example does not do that, so I have to remove the money from them and in any event my dealings with them have shown them to be at best inept so I'd prefer to get away from them. I've looked at AJ Bell, Interactive Investor and Hargreaves Lansdown but find it hard to choose although I've bought and sold stock before I am far from a seasoned investor and living mainly overseas 8 hours out of wack with the UK it needs to be relativity simply too.

If I include the aforementioned FSAVC the amount I could transfer/switch into a SIPP would be IRO £170,000 although I'd grab my 25% straight away. In both our cases the rental income more than uses up the UK tax allowance although so far we've managed to stay in the 20% band.

My wife will get 2 small pensions at age 65 unless she chooses to draw early both are DB schemes, we don't expect combined they will amount to more than maybe £2000 pa.

[Deleted User]

I have the same problem and an IFA suggested I look at the charges in the company schemes.
I too have a Mercer/Aegon DC as well as various Xafinity ones
The Mercer charges are 0.23% for the default fund all in, I also have some money in a Active fund (0.68% but the growth since July 2018 is 15.6%)
After looking at all the charges and growth - I have left them where they are until I consolidate them next year 6 months before I retire

[Deleted User]

As a aside - you might want to check your tax residency status. Especially if you are eligible for the MM2H visa which looks very tax efficient

theboots

Deleted_User wrote: »

As a aside - you might want to check your tax residency status. Especially if you are eligible for the MM2H visa which looks very tax efficient

MM2H you need to bank RM350K in a fixed deposit account & demonstrate an income of RM10000 a month, a number of the tax perks such as car have been withdrawn, my wife is Malaysian so I am on a spouse visa, only need to demonstrate an income of RM2000 a month or better.

My understanding although it is possible I have the wrong end of the stick is there's a number of problems at least whilst we have property in the UK.
1. Income earned in UK attracts tax there - that's our rental resident or not
2. Non tax resident on the first death we cannot pass the estate tax free as she's not a citizen.
3. Non resident non citizen doesn't get a tax allowance so she'd pay tax on her total rental income rather than £11,000.
This was the advice a tax lawyer trained in the UK gave me, at the time I was also running the limited company, that I shall close at its year end this month.

theboots

Deleted_User wrote: »

I have left them where they are until I consolidate them next year 6 months before I retire

6 months to retirement is where I find myself now, or slightly less hence the query about consolidation.

theboots

Got a call booked with the Aegon team next week, don't know if they're a consideration or not as yet. Just getting everything in one place is going to be helpful, choosing the right place now that's the thing.