Trivial Commutation over £30k?

Whiterose23

Just to add that the email says to fill in the forms and send back, but I only want to do that if I'm sure taking this is the right thing to do, and what repercussions on tax etc. I've tried calling but can't get through to anyone.

xylophone

"The HMRC value of your benefits is calculated using a complex formula, but the value has been calculated as £26,232.92 at the current time. If the value of your benefits held elsewhere is less than (£30,000 - £26,232.92)  = £3,767.08, then you will be eligible. This is a small amount to be eligible for, but all members up to the threshold of £30,000 have been contacted to check if they are eligible to take the lump sum."

 Looking at  the figures in your previous posts, and at  those in your post above, it appears that the Transfer Value offered by Kingfisher (whether it is

 'One-off lump sum of £33,470 +  Value of MP/AVC Arrangement: £7,900.

or

 £35,627 

 is not the same as the value of the benefits as calculated by the HMRC formula (to which poster Tommyjw refers in his previous).

   You stated that the annual pension on offer was £906 per annum.

The poster Tommyjw commented 

https://forums.moneysavingexpert.com/discussion/comment/78247027/#Comment_78247027

£906 pension = £18,120 triv com value, plus avc, less than 30k. 

£18,120 + the value of your AVC (somewhere between the £7900 mentioned above and the £8600 mentioned in a later post) gives a figure very close to the £26,232 stated in your latest letter from Kingfisher.

This figure is well within the £30,000 max Trivial Commutation  BUT you have other pensions.

You have made reference to another DB pension and the DC pension to which you currently contribute

I have another deferred DB pension currently at £129k CETV and my works DC pension which is at £26k currently. I haven’t taken anything from them but does their existence affect this?

Kingfisher say

If the value of your benefits held elsewhere is less than (£30,000 - £26,232.92)  = £3,767.08, then you will be eligible  (for TC)

Your benefits held elsewhere are considerably in excess of £3,767.08.

In this connection, see my post of 12 April

https://forums.moneysavingexpert.com/discussion/comment/78242465/#Comment_78242465

as well as Tommyjw's in the same connection.

Whiterose23

Thanks for your help with this. I do find it odd that the existence of other pensions, not yet in payment, would affect whether this can be taken as a lump sum. Sorry for my lack of knowledge of pensions!

xylophone

Thanks for your help with this. I do find it odd that the existence of other pensions, not yet in payment, would affect whether this can be taken as a lump sum. Sorry for my lack of knowledge of pensions!

I think that pensions and the legislation surrounding them  are not  that easy to understand - on top of that, there have been a number of changes over the years regarding occupational pensions ,private pensions and state pensions.

I have a reasonable familiarity with the subject but until I looked closely at Tommyjw's posts and at the various figures that have come up in relation to this particular pension, I had not fully grasped the difference between the benefit value calculated under the HMRC formula and the CETV.

Whiterose23

How confusing it is though ... I check my CETV total regularly and then receive an offer from the pension provider that differs, and then a third figure calculated by HMRC that is almost £10,000 less than the CETV online figure.

I managed to speak to someone at Kingfisher yesterday who confirmed the advice given on here, but who couldn’t explain why the existence of other pensions, not yet in payment, affect whether you qualify for a trivial sum pay out.

The while thing should be much easier to understand than it is I think.