help...pension?

xylophone

the letter from BT said that as my BTPS benefits have a value of less than £10000 I'm eligible to receive small pot lump sum governed by HMRC rules

Are you already receiving the BTPS pension?

SINDYGIRL

I get £18 a month from them

biscan25

So it's in payment so in theory all taxable. But your total income is less than the personal allowance so your marginal rate is zero. (Pensioners do pay tax by the way if total income is above the personal allowance).

If the question is should you take it, then the answer is probably not if just considering value.
I'm not sure of the nature of that pension in terms of increases and spouses pension etc, but the value could likely fall into the range of 15 to 25 x the annual pension. You are being offered 10.

xylophone

Have you obtained a state pension forecast?

https://www.gov.uk/check-state-pension

SINDYGIRL

Yes £185 per month

SINDYGIRL

Won't get till 2025

SINDYGIRL

Doh,!!!£185 a week

biscan25

Another thing that I'm not sure on, as I don't have sight of your other circumstances, partner's income, savings etc, is pensions credit.
This tops up your income to £182.60 single / £278.70 joint if you are both over state pension age.

If you are likely to get this, then obviously it's good to minimise your income and it might actually make sense to take the lump sum now.

biscan25

biscan25 said:

Another thing that I'm not sure on, as I don't have sight of your other circumstances, partner's income, savings etc, is pensions credit.
This tops up your income to £182.60 single / £278.70 joint if you are both over state pension age.

If you are likely to get this, then obviously it's good to minimise your income and it might actually make sense to take the lump sum now.

Obviously this is redundant with £185/week !!!

SINDYGIRL

Sorry i thought I had posted...I'm 63 single retired own own house have £65000 savings...get £400 monthly  pension from previous job and £18 monthly pension from BT...that's all I have