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Does the pension tax free lump sum count as income?
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chucknorris
Posts: 10,793 Forumite
When I retire in a few years time, I know the tax free lump sum is not taxable, but does in count as income (but taxed at 0%)? I am asking because I am hoping to stay below the notional 60% tax band, which isn't going to be easy, and obviously more difficult if the TFLS counts as income? I suspect that it doesn't, but I do not know for sure.
Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop
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The tax free lump sum has no effect on your general tax situation . It is completely separate and not taxed at 0% or anything like that ..2
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Thanks, I did think that was the case, but I needed to make sure, rather than merely assuming that.Albermarle said:The tax free lump sum has no effect on your general tax situation . It is completely separate and not taxed at 0% or anything like that ..Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop0 -
On retiring, I took a TFLS a couple of years ago which, if it was seen as income, would have taken me into a higher tax band and nothing of the sort happened.
AFAIK, the taxman just ignored it completely, just as he did the TFLS from my work-related AVC.There is no honour to be had in not knowing a thing that can be known - Danny Baker1
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