Fidelity SIPP

Moe_The_Bartender

My wife is trying to get some of her tax free cash out of her SIPP. I have to deal with this stuff and naïvely expected that doing this would be a simple matter of ringing up and asking for it as we did when we used an IFA. Seemingly not and our Wealth Relationship Management Team (who don’t actually seem to do anything), referred me to the Pension Retirement Team who were unavailable and suggested that I talk to the Wealth Relationship Management Team who referred me back again! So far, so bad.

Now, I would have thought that if I can’t just ring up and ask for the money, this should be a simple matter of getting the necessary form from the website, emailing it in and waiting for the cash to hit my account. But, no. It seems that I have to have a conversation with them to go through a few regulator points before they will send in the form. They require a wet signature so I would have to mail the form in where it goes to their post department who scan it, upload it and destroy the form with the wet signature on making the whole thing pointless.

I have no prior experience of accessing tax free cash so I am wondering if this procedure is fairly standard amongst SIPP providers.

On a related matter, it occurs to me that to avoid this in the future, whether we should simply take all the tax fee cash available, reinvest it and draw on it as we need it. Are there any negatives to this? At the moment, we are taking her annual allowance of £12,500 as income and are looking to take the other £4,166 as tax free cash. Alternatively, would it make any sense at all to stop taking regular income from the SIPP and live off the tax free cash until it’s gone. I think I may already know the answer to this.

Sea_Shell

I can't offer any advise about the process (we'll have the joys of this experience next year - but not with Fidelity), but as for taking the max tax free cash and reinvesting it outside the pension (ISA) is exactly what we plan to do.     Then, drawdown the balance up to PA, for as long as the pot lasts, which will hopefully be before tax becomes payable on total income once DB and SP kick in 10 years later.

Chickereeeee

Its a somewaht less painful experience with AJBell (Youinvest). You can get the mandatory Illustration online from their website, while you wait. Then, download a form, fill it in on your pc, anwering the mandatory questions. Then you have to print out, sign and mail back (together with any required LTA information. I got an emal to say the form had arrived the next day. TFLS was dispatched within a week. No phone calls, no discussioms.

TBC15

I recently moved to Fidelity and they appear to like their on paper paperwork more than some providers.

I wouldn’t take the max tax free cash out unless you can stick it into an ISA straight away otherwise your tax free cash now moves into CGT territory when you invest it.

I’d go for the £12500 + £4166 PA on a monthly basis and use that PA.

Moe_The_Bartender

I take the point about CGT but have no current liabilities so the possibility of exceeding the annual exempt amount of £12,300 is pretty slim. Am I missing something?

Alexland

Fidelity have always been quick to process any physical paperwork we have sent them. Earlier this year I took up the invitation to speak to my assigned Wealth Manager to see what he had to say but he failed to call me at the scheduled timeslot and it didn't seem worth chasing. Maybe he looked at my account to see I was one of the unwashed £45 cheapos.

TBC15

Moe_The_Bartender said:

I take the point about CGT but have no current liabilities so the possibility of exceeding the annual exempt amount of £12,300 is pretty slim. Am I missing something?

If the CGT allowance gets slashed in the budget it may have more relevance for you.

Sea_Shell

AIUI, CGT is payable on profit at the time of sale.

If you only have small gains, say £1000, do you still have to complete a self assessment to HMRC??

Or is it only if CGT is payable?

garmeg

Sea_Shell said:

AIUI, CGT is payable on profit at the time of sale.

If you only have small gains, say £1000, do you still have to complete a self assessment to HMRC??

Or is it only if CGT is payable?

Only if CGT is payable or if the total sales are 4 times the CGT allowance (whether CGT is payable or not)

So if you only sold £11,000 and made a profit of £1,000 (bought for £10,000) you need do nothing.
But if you only sold £61,000 and made a profit of £1,000 (bought for £60,000) you need to declare even though no CGT is payable.

Sea_Shell

garmeg said:

Sea_Shell said:

AIUI, CGT is payable on profit at the time of sale.

If you only have small gains, say £1000, do you still have to complete a self assessment to HMRC??

Or is it only if CGT is payable?

Only if CGT is payable or if the total sales are 4 times the CGT allowance (whether CGT is payable or not)

So if you only sold £11,000 and made a profit of £1,000 (bought for £10,000) you need do nothing.
But if you only sold £61,000 and made a profit of £1,000 (bought for £60,000) you need to declare even though no CGT is payable.

Great thanks.    Does it make a difference if you have no other taxable earnings?    Do you get a PA plus CGT allowance?  Do they get added together?

garmeg

Sea_Shell said:

garmeg said:

Sea_Shell said:

AIUI, CGT is payable on profit at the time of sale.

If you only have small gains, say £1000, do you still have to complete a self assessment to HMRC??

Or is it only if CGT is payable?

Only if CGT is payable or if the total sales are 4 times the CGT allowance (whether CGT is payable or not)

So if you only sold £11,000 and made a profit of £1,000 (bought for £10,000) you need do nothing.
But if you only sold £61,000 and made a profit of £1,000 (bought for £60,000) you need to declare even though no CGT is payable.

Great thanks.    Does it make a difference if you have no other taxable earnings?    Do you get a PA plus CGT allowance?  Do they get added together?

I don't think so, the CGT allowance is all you have to offset capital gains. If you don't use your PA in a given year you lose it.