How do I open multiple SIPPs with Hargreaves Lansdowne

cloud_dog

Ok, novice notification time 😳

I thought I had a handle on the benefit of doing a small pot withdrawal, but I'm trying to recognise the value or benefit of using the small pot rule for £10k, as opposed to undertaking a UFPLS for £10k?

Is it just that the primary benefit is for those who may have pots where (now) the pot size TFLS would be above the LTA for TFLS?

QrizB

cloud_dog said:

Ok, novice notification time 😳

I thought I had a handle on the benefit of doing a small pot withdrawal, but I'm trying to recognise the value or benefit of using the small pot rule for £10k, as opposed to undertaking a UFPLS for £10k?

Is it just that the primary benefit is for those who may have pots where (now) the pot size TFLS would be above the LTA for TFLS?

I think it avoids the MPAA too?

cloud_dog

Ah yes. Thanks.

Dazed_and_C0nfused

QrizB said:

cloud_dog said:

Ok, novice notification time 😳

I thought I had a handle on the benefit of doing a small pot withdrawal, but I'm trying to recognise the value or benefit of using the small pot rule for £10k, as opposed to undertaking a UFPLS for £10k?

Is it just that the primary benefit is for those who may have pots where (now) the pot size TFLS would be above the LTA for TFLS?

I think it avoids the MPAA too?

I suspect that is the benefit for the majority.

The LTA aspect is valid but a distant dream for most of us!

There is a subtle difference tax wise as well.  The taxable element of a "small pot" should be taxed at BR.  The first payment from a DC pension that isn't a "small pot" will have the emergency code, 1257L, operated on it (on a non cumulative basis).

Occasionally we've had people thinking small pots were exempt from tax but they aren't, the difference is the code used, ultimately they are just an extra source of pension income.

cloud_dog

Thanks, I hadn't considered the  taxation method before.