Pension platform with least bureaucracy on UFPLS withdrawals

Qyburn

Hi,
I've seen references to platforms/providers where to make a UFPLS withdrawals require you to jump through a few hoops. For example I think someone said that Hargreaves Lansdown requires you to apply by post each time.

Are there any that allow this as a simple online transaction? Also hopefully no fee either.

Thanks.

tacpot12

I found AJ Bell to be very simple. I have been making monthly UFPLS withdrawals for the last 3 and a half years. I just send them a secure message when I want to increase the amount. They send a monthly payslip and BCE letter by secure message. The BCE letter just confirms how much Lifetime Allowance you have used and have left.  

Setting up the payments was the only bit that was slightly tricky as you had to request a pension illustration, and then accept it when it arrived via secure message, but it was still straightforward. Although the process many have changed (for the better or worse) since then. 

Albermarle

Qyburn said:

Hi,
I've seen references to platforms/providers where to make a UFPLS withdrawals require you to jump through a few hoops. For example I think someone said that Hargreaves Lansdown requires you to apply by post each time.

Are there any that allow this as a simple online transaction? Also hopefully no fee either.

Thanks.

The issue is that it is possible to take your whole pot in one go via UFPLS. So the provider is obliged to check with you that you definitely know what you are doing, you will have no pot left to withdraw from in future etc etc
Some apply this rule to every UFPLS payment, large or small, to varying degrees. One way to minimise admin is to take just one UFPLS per year, and stick it in an easy access savings account and withdraw from it when you want.
Most retail providers are not able to set up a monthly UFPLS payment, although AJ Bell can apparently and maybe others will follow/update their systems.
Another alternative is to take one tax free payment year, and then set up a regular monthly taxable income., which does not seem to cause the same admin issues AFAIK

Qyburn

Thanks, to give context it's a small DC pension which I intend to keep on more or less as a savings account, so withdrawals will be as the need/whim takes us and definitely not regular.  Current value's £2,300 so wouldn't add significant monthly income and wasn't taken into account when planning our retirement income.

One option if the bureaucracy is unavoidable would be to take it all in one go, in a year where that means I won't pay tax, and stick it into an ISA where it's all at my fingertips. But I kind of like having it as a separate account.

Currently it's with Royal London invested in one of their Lifestyle options, which incidentally seems bizarrely complex.  The value is spread across 15 funds, and they deal all the time - for example there have been no contributions since December but in February there have been something like 60 Buy/Sell/Switch transactions, some for just 1p (one penny).  That can't be efficient.

tacpot12

You could ask AJ Bell about what is involved in making adhic UFPLS withdrawals. I've found them responsive and reliable. 

The Royal London dealing you mention is almost certainly nothing other than internally rebalancing the portfolio, and also most certainly will not be incurring any dealing charges for Royal London.

Farside71

They are possibly also exchanging units to pay fund charges 

Albermarle

One option if the bureaucracy is unavoidable would be to take it all in one go, in a year where that means I won't pay tax, and stick it into an ISA where it's all at my fingertips. 

This would seem the simplest option. 

Qyburn

Simplest, but puts an end to annual £2,880 contributions.

molerat

Qyburn said:

Simplest, but puts an end to annual £2,880 contributions.

Why ?  Just do it once a year.  We do it with HL, do the prelim questions on line and fill in the form that comes in the post.  Not a major inconvenience.  Just need to get the month right to pay the correct tax.

pensionpawn

Albermarle said:

One option if the bureaucracy is unavoidable would be to take it all in one go, in a year where that means I won't pay tax, and stick it into an ISA where it's all at my fingertips. 

This would seem the simplest option. 

This would have to be at the end of the financial year not to be clobbered with tax you have to claim back (more paperwork...) My wife has to complete paperwork every month with Hargreaves Lansdown. With the postal strikes it's a complete pain in the !!!!!! with payments being delayed.

squirrelpie

pensionpawn said:

This would have to be at the end of the financial year not to be clobbered with tax you have to claim back (more paperwork...)

Depends on your tax position of course. HL have a [correct] BR tax code for my SIPP, so it doesn't matter for me. They deduct 20% off the taxable bit, which is what I owe. But I've given up on UFPLS because of the paperwork hassle anyway. Setting up an annual drawdown with monthly payments and redistributing the tax free part myself seems to be a lot easier to organize.