Exceeded LTA, now what?

cfw1994

Croeso69 said:

Albermarle said:

If you die before 75 your beneficiaries can avoid any LTA test by leaving the uncrystallised amount untouched for 2 years, the downside is that drawdown will be taxable on the recipient. So it could be a good idea for a basic rate or non taxpayer.

To digress from the main topic a little . If I died before 75 , who would inform my beneficiaries of such rules/options  like the above , if I did not have a financial advisor. Would the provider lay out the options ? Or would it be down to me to leave instructions, assuming my beneficiaries were not pension experts?

And how would they know how much LTA you had left, if any? You can have more than one pension and some may have been drawn down completely a while ago, so they may not know how much LTA was used for those (or even that they existed).

In my very limited experience (just Aviva), each time you crystallise you get an LTA Certificate telling you what % was taken in that action.   I would expect all providers to give you that, but cannot confirm this.
No 'rolling total', but then as mentioned, you might have several from different providers.

At that point.....well, it is up to your executors to collate those together & figure out, with the help of your will, what the story is with the estate, perhaps any options like the possibilities mentioned here, & explain to your beneficiaries. 
Of course, maybe the executor and beneficiary/ies are one & the same.....

Perhaps a reason to have the normally unspoken conversations about where things are, & what to do.   Tricky stuff, eh.

Albermarle

I would expect all providers to give you that, but cannot confirm this.
No 'rolling total', but then as mentioned, you might have several from different providers.

From other threads it seems the provision of LTA info is better from some providers than others . Also as you say you have to keep your own rolling total. It is not even clear that if HMRC do that as well and/or even checking up on it .

.well, it is up to your executors to collate those together & figure out, 

What is the likelihood that your executor , who might well be a family member , is up to speed with LTA rules ? More than likely they would not have a clue what LTA was .

cfw1994

Albermarle said:

I would expect all providers to give you that, but cannot confirm this.
No 'rolling total', but then as mentioned, you might have several from different providers.

From other threads it seems the provision of LTA info is better from some providers than others . Also as you say you have to keep your own rolling total. It is not even clear that if HMRC do that as well and/or even checking up on it .

.well, it is up to your executors to collate those together & figure out, 

What is the likelihood that your executor , who might well be a family member , is up to speed with LTA rules ? More than likely they would not have a clue what LTA was .

I never suggested this would be easy.....I am sure many/most will fail to spot subtle nuances that could otherwise save them future £££s.
Hence my last line, suggesting that for those of us lucky enough to have these problems, part of our life ought to be ensuring those that would be left behind as beneficiaries are able to deal with things in the 'worst case scenario' situations.   
Not easy at all.   

jamesd

cfw1994 said:
Hence my last line, suggesting that for those of us lucky enough to have these problems, part of our life ought to be ensuring those that would be left behind as beneficiaries are able to deal with things in the 'worst case scenario' situations.   

Not easy at all.   

Ensuring that the executors are willing to act is also useful. Complexity might discourage some.