Private pension transfer

spurdog1

My wife has had a private pension from her employer (as was) for some time over a decade. My understanding is that this is to be taken by a different administrator. 

As a result of that we are about to be offered a cashing in value. I have worked out what is possible to be offered, though I may be miles out.

I am wondering if the figure will be negotiable, or do I have to accept/refuse their offer? Furthermore tax may be involved, and "is it reclaimable from the tax man"? We are both under the earnings thresh-hold and have need of private surgery (hip) which will hopefully resolve by going private, cash only.

We will not search cheapest bargain, wifey is a bit stubborn. Stay close to the facility. Can you offer any advice?

I did last year have a financial advisor to convert my funds to a pension, but i feel he may charge. Sorry thats as best info i have....
K

Dazed_and_C0nfused

Is her pension defined benefit (promise to pay £x) or defined contribution (pot of money)?

spurdog1

Hi Dazed, thanks so much for a prompt response.
Sadly I have no idea, i'm flying blind and not good at pensions

Marcon

spurdog1 said:

My wife has had a private pension from her employer (as was) for some time over a decade. My understanding is that this is to be taken by a different administrator. 

As a result of that we are about to be offered a cashing in value. I have worked out what is possible to be offered, though I may be miles out.

I am wondering if the figure will be negotiable, or do I have to accept/refuse their offer? Furthermore tax may be involved, and "is it reclaimable from the tax man"? 

Changing administrator doesn't result in offering a cash in value to members. It'll be pure coincidence - possibly because the new administrator has been tasked with identifying and contacting all members who might fall within the scope of a particular type of exercise designed to encourage members to take certain actions. 

I note the title of your thread is 'private pension transfer' but as your wife is already receiving her pension, a transfer isn't possible (unless this is a different pension from the one already in payment?).

It's possible that she has been offered a cash lump sum now instead of future monthly payments. Do the words 'trivial commutation' or other similar jargon appear anywhere in the documents she's been sent?

The figure won't be negotiable.

spurdog1 said:

We are both under the earnings thresh-hold and have need of private surgery (hip) which will hopefully resolve by going private, cash only.

We will not search cheapest bargain, wifey is a bit stubborn. Stay close to the facility. Can you offer any advice?

Your GP is probably best placed to advise on surgery rather than a bunch of strangers who are active on a pensions forum!

spurdog1 said:

I did last year have a financial advisor to convert my funds to a pension, but i feel he may charge. Sorry thats as best info i have....
K

Yes, financial advisors do charge. If they don't they'd be out of business.

Much more information needed before any meaningful reply could be offered. Have another look at the paperwork and perhaps quote from that?

spurdog1

Thanks
Due to GP inaction i have contacted the spinal consultant locally, through BUPA. Yes it cost me £180.00 but money well spent. The surgeon whom will do the hip, is the local NHS surgeon (but acting privately), so no prob there.
Will do quote from p/work, just hoped a bit of peace of mind.

spurdog1

"It's possible that she has been offered a cash lump sum now instead of future monthly payments. Do the words 'trivial commutation' or other similar jargon appear anywhere in the documents she's been sent?"


- not sure of circumstances, no words of "trivial commutation"

spurdog1

any idea what a 80yo cash in may be?

Marcon

spurdog1 said:

any idea what a 80yo cash in may be?

Depends entirely on the individual scheme, but if you multiply her current annual pension by 10 that might be in the right sort of ballpark.

spurdog1

a bit low, but better than i could have "night-mared"

xylophone

Are you able to check the documents you have been sent for the precise details?

Are you saying that your wife (aged 80) is  in receipt of a modest monthly sum from her old defined benefit occupational pension scheme?

The scheme is to change administrator and an exercise has been undertaken involving offering those eligible "trivial commutation" of a pension in payment?

Did the payments commence before or after 6 April 2006?

See https://www.litrg.org.uk/tax-guides/pensioners/how-do-i-cash-my-small-pension

If a trivial commutation lump sum is paid in exchange for a pension already in payment, all of it will be taxable as normal income in the year in which it is paid.

In all cases, there are rules about how much you can receive as a trivial commutation lump sum, and when you can receive it.

spurdog1

xylophone said:

Are you able to check the documents you have been sent for the precise details?

Are you saying that your wife (aged 80) is  in receipt of a modest monthly sum from her old defined benefit occupational pension scheme?

The scheme is to change administrator and an exercise has been undertaken involving offering those eligible "trivial commutation" of a pension in payment?

Did the payments commence before or after 6 April 2006?

See https://www.litrg.org.uk/tax-guides/pensioners/how-do-i-cash-my-small-pension

If a trivial commutation lump sum is paid in exchange for a pension already in payment, all of it will be taxable as normal income in the year in which it is paid.

In all cases, there are rules about how much you can receive as a trivial commutation lump sum, and when you can receive it.

Xylophone this is fabulous and gives me what i need, and much more. I can't thank you enough. We'll see what can be found soon, with this info.