Teachers prudential AVC cash in

bella238

I would like some advice on the 20k I have in my Teachers prudential AVC. I took early retirement last year , taking my teachers pension, and now work part time. I would like to take the cash as a lump sum to invest. How much would be taken in tax? Thank you.

SonOf

How much would be taken in tax?

Depends on your income. However, 25% will be tax free and the other 75% will be treated as income and taxed in your appropriate band.

zagubov

I was in a similar situation. You can ask for 25% tax free.

The rest I wanted put in a fund for drawdown, but they didn't have one I could transfer to directly.

They would only release that money if I consulted a financial advisor. I wanted to transfer to their fund so I used their financial advisor.

I wasn't interested in an annuity - the payments seemed tiny.
I didn't want to take the whole money as cash as there would be a lot of tax to pay.

I wasn't interested in moving to another company's fund as (1) I haven't the time to research or become good at picking funds and (2) I've no particular knack for it. I'd have to find an IFA first and I'd already decided that I was prepared to invest the rest of the money for long-term growth.

With hindsight, I doubt I'd have chosen this way to boost my pension if it was so complex to access the money afterwards.

OldBeanz

You will pay tax on £15k. You have not stated how much you are earning but your tax allowance is £12.5k after which you will pay 20% with the tax rate going up to 40% from £50k onwards.
You need to go here to reclaim any extra tax the system may, in the short term, take from you https://www.gov.uk/government/publications/income-tax-repayment-claim-when-small-pension-taken-as-a-lump-sum-p53