Small locked pension

tomsand888

Hi all,

looking for some general advice...

I am work for quite a few employers of fixed term contracts (nature of my work).
My last employer made contributions through pension provider during my contract time to roughly $4500 (i was paid in USD).

This amount is sat there and i can't add to it, (dont have another place to move it to).

Is the best course of action just to sit on it...?

cheers
tom

Albermarle

Can you clarify if this pension is in UK? in which case it would be in Pounds , not dollars.
Also who is the pension company involved ?

tomsand888

Hi albermarle,

thanks for quick response. that is a good question I hadn't considered.

I was technically paid in USD but by a UK employer and paid through PAYE. Therefore the pension contributions are in USD. I would presume this is then a US matter?

The provider is Zurich international..

xylophone

https://www.zurich.com/en/products-and-services/protect-your-employees/protect-your-internationally-mobile-employees/group-pensions-and-savings-for-your-internationally-mobile-employees/international-pension-plan

Is it the above?

(dont have another place to move it to).

A deferred option is mentioned in the above but have you checked whether it would be possible to transfer into a UK based pension?

You do have your own personal pension? If not, is there a reason why not?

tomsand888

Hi,

that looks like it is; the IPP.
I don't have a personal pension -(largely as i haven't spent a great deal of time reviewing it.I work internationally and some times as consultant - so i always regarded it as too complicated and time consuming. (albeit naively)

I am adding the detailed brief in my exit email from my employer(previous). It appeared that the deferment was also locked - although its not clear. So i would still be unable to pay further instalments.

I would consider starting a personal pension, but presume a tax implication if i have to withdraw?

Leaving your money invested for the future

If you don’t need your money right now you can leave it invested in the Plan for as long as you like. You will not be able to make any further contributions but you can change your fund selection at any time. Leaving your money invested with us means you retain full control of your investments with full access to all the features of Zurich International Online (ZIO). Depending on your future plans and personal financial circumstances it may be more beneficial for you to seek continued growth on your investments until you reach the point in time when you need the money. It is important to note that market performance is not guaranteed and the value of investments can down as well as up.

Transfer your money into an alternative Plan

If you decide you want to leave your employer's Plan but you would like to retain your investments on the Zurich platform, you may be able to transfer your benefit into an International Deferred Benefit Plan. You can remain in this plan for as long as you like and you can request regular, partial or full withdrawal of your funds at any time. You can't make any further contributions but you can make changes to your investment choices at any time through ZIO. If you are interested in this option please contact our Corporate HelpPoint team on +44 1624 691013 and they will send you more information and joining instructions.


Keeping your personal information up to date

If you decide to remain invested in the Plan, it is vital that your personal details and beneficiary nomination information on Zurich International online (ZIO) are correct and kept up to date so we can contact you at any time about your Plan.


Withdrawing money out of your Plan

You can request withdrawal of your money in accordance with your plan rules.

All payments will be paid into your personal bank account.

You may also be able to transfer the full cash value or the existing investments in your Plan to another retirement plan if the plan administrator will accept the transfer.

IMPORTANT TAX NOTE: When taking money out of your Plan, it’s important to consider your personal tax obligations. You are personally responsible for ensuring correct and proper tax filing. If you have any doubts at all about your personal tax situation or obligations we would recommend that you seek professional advice before making any decisions

xylophone

You may also be able to transfer the full cash value or the existing investments in your Plan to another retirement plan if the plan administrator will accept the transfer.

You would need to check with the provider of a UK pension whether a transfer in would be accepted - a "stakeholder" might be the answer to this initially - see https://www.pruadviser.co.uk/knowledge-literature/knowledge-library/transfer-pension-scheme/

However, although most schemes provide the right to transfer, not every scheme has to accept an incoming transfer.

A stakeholder pension scheme is currently the only type of scheme which must accept any transfer from another registered pension scheme.

The stakeholder could later be transferred to a PP/SIPP etc.

I would consider starting a personal pension, but presume a tax implication if i have to withdraw?

As the law stands at the moment, you may access a personal pension from age 55.

At this point you have options about how you access the money, one of which is 25% as tax free lump sum with the balance taxed as income when you choose to take it.

You might like to consult an Independent Financial Adviser concerning your pension planning.

https://adviserbook.co.uk/ You would tick "confirmed independent" and such other options as are required.

Some reading for general information

https://www.pensionbee.com/pensions-explained/pension-contributions/contributing-to-your-pension-from-your-limited-company

https://www.cavendishonline.co.uk/stakeholder-pension

https://www.pensionsadvisoryservice.org.uk/about-pensions/saving-into-a-pension/pensions-and-tax/tax-relief-and-contributions

https://www.pensionwise.gov.uk/en/pension-pot-options

tomsand888

Thank you xylophone - looks like i've got a bit of homework for the weekend!!

Feedback much appreciated..