Section 32 bond

Shinerlite

Hello, hopefully a simple question.
I have a s32 bond with GMP payable at age 65 yrs. If this is taken (I have been asked by provider to submit an annuity application) would it trigger any limits on contributions to my SIPP? I haven't touched my SIPP and intend to contribute for a year or two more.

Marcon

The £4K Money Purchase Annual Allowance is only triggered if you 'flexibly access' your pension benefits. What you're doing isn't counted as 'flexible access' so the MPAA isn't triggered.

xylophone

I have a s32 bond with GMP payable at age 65 yrs. If this is taken (I have been asked by provider to submit an annuity application) 

https://www.financialadvice.net/s32_buy_out_plan/zone/1288

Your provider must at the least pay you the GMP - depending on policy investment performance, you may also have the possibility of a tax free Pension Commencement Lump Sum.

Your fund will be used to purchase a Lifetime Annuity?


https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/money-purchase-annual-allowance-mpaa

The MPAA won’t normally be triggered if:  

• You take a tax-free cash lump sum and buy a lifetime annuity that provides a guaranteed income for life that either stays level or increases. 

Check with your S32 provider.

Shinerlite

Your provider must at the least pay you the GMP - depending on policy investment performance, you may also have the possibility of a tax free Pension Commencement Lump Sum.

GMP is the higher amount

Your fund will be used to purchase a Lifetime Annuity?

Yes. This policy has passed on in time and the latest provider says must submit annuity application to the original provider for the GMP

Check with your S32 provider.

Not the most helpful provider - tried to get me to buy an annuity with the smaller investment funds before I reminded them it was GMP.