Early retirement - any tax cutting tips?

bgscotty

Hello gang!

I would be grateful for your advice and comments on my specific query and situation.

On 19 October 2007, I took early retirement from employment on medical grounds.

As part of this, I will receive a pension of £5100 (approx.) and a lump sum of £15100 (approx.). I am just about to send the confirmation of my personal details to the pension provider to allow the pension to be processed.

The pension will be my sole source of income.

In terms of savings, I have some money in various accounts (Halifax Regular Saver, Sainsbury's Internet Saver, NS&I Index Linked Certificates) and I have maxed out my ISA allowance.

I would like to ensure I am making the most of my now-non-taxpaying status and wonder if there is a way to achieve this effectively (e.g. from my savings, pension income etc.).

All hints and tips gratefully received.

Thank you in advance for your help.

Scotty

EdInvestor

Check which tax office will now be dealing with your affairs ( the one which deals with the pension payer) and let them know the details so they can adjust your tax coding/provide any likely refund.

You should look at maxing out your investment ISA (4k on top of 3k cash ISA). Your pension will likely be tax free due to the personal allowance and your interest income should come within the 10% band. Dividend income on shares/equity funds is also effectively tax free.

What about benefits?

Do you own your own home?

Andy_L

bgscotty wrote: »

I would like to ensure I am making the most of my now-non-taxpaying status

You are subject to (income) tax at the same rates as anyone else. Your annual pension pretty much uses up your tax allowance so any non-ISA savings/investments (& some NS&I) products will be taxed.