Transfer valuation from DB Pension - advice

Mick70

Are the calculations I put in today correct? I wasn’t 100%.
Thanks

Albermarle

(do you still get personal allowance , regardless of 25% tax free amount)

Yes , they are completely separate from each other ,
So your calculation is correct , assuming no other taxable income at all . Remember when state pension is payable , it is taxable as well.

Andrew31

You ask what i would do in your situation?

1. Apply for enhanced LTA protection
2. Seek financial advice.
3. Take advice on a moneysaving website with a truckload of salt.

Mick70

Andrew31 wrote: »

1. Apply for enhanced LTA protection
2. Seek financial advice.
3. Take advice on a moneysaving website with a truckload of salt.

1. that would not be available, as I was in a db scheme and the valuation came under the LTA , so there is no protection for me , unfortunately
2. I have/am (the first IFA however was not really independent hence this has dragged out)
3. I know where you are coming from on this, however there are some knowledgeable folk on here who are helpful

jamesd

Mick70 wrote: »

so "IF" i have worked this out right ?
yr1 - drawdown of £52k =
tax free 25% of £13,750
personal allowance , tax free again, of £12500 (i assume you still get this bit)
and then 20% tax paid on balance of (52000-13750-12500) = £5300 tax to pay
SO , in bank would receive net pension of £52,000-5300 = £46,700

would that be right ? (do you still get personal allowance , regardless of 25% tax free amount)

You still get the personal allowance. Even when you've gone over the LTA. But no 25% tax free lump sum on amounts once you've gone over the LTA, so a bit over 250k tax free per person.

In your calculation 75% taxable is 39k, minus 12.5k leaves 26.5k taxed at 20% so 5.3k tax. So I agree, £46,700 net.

But thinking of the LTA charge at age 75, better to take 50k taxable plus £16,666.66 tax free. 50k-12.5k = 37.5k at 20%, £7,500 tax. So £66,666.66 taken less £7,500 tax leaves £59,166.66 net. No need to spend it all, the excess can go into an ISA, this is just about maximising your basic rate band use to save LTA charge later..

The new quote is similar to the others and hasn't changed my view that it's a great deal.

LHW99 wrote: »

Is she happy to manage a DC pot after you have passed (if necessary) or would she prefer the certainty of a survivor's pension?

State pension deferral and some eventual buying of annuities in her name will take care of that issue.