When to close sipp

HIA

Two years ago when I stopped working I opened a wealthify pension and as I don't have any income at the moment I have payed in the £2880 annual maximum to benefit from tax relief.  The current balance is £6960. I am delaying taking my "real" final salary pension so this is really just a savings scheme.  I have thought of taking the money out while I'm still a non tax payer to use my personal allowance but don't want to fall foul of recycling rules. Should I take it all (or leave a £1?) and can I then pay in £2880 in the new financial year? 

NedS

Nothing you have told us would lead us to believe you would fall foul of pension recycling rules.

It would make sense to withdraw the money tax free if you can. Income tax will likely be deducted, but you will be able to reclaim it if your taxable income is below your personal allowance.

As you are still of working age, it would also make sense to withdraw it under the Small Pots rule (pension of less than £10k) as this will not trigger the MPAA which may impact you if you ever decided to return to work (you don't say how old you are).

Albermarle

HIA said:

Two years ago when I stopped working I opened a wealthify sipp and as I don't have any income at the moment I have payed in the £2880 annual maximum to benefit from tax relief.  The current balance is £6960. I am delaying taking my "real" final salary pension so this is really just a savings scheme.  I have thought of taking the money out while I'm still a non tax payer to use my personal allowance but don't want to fall foul of recycling rules. Should I take it all (or leave a £1?) and can I then pay in £2880 in the new financial year? 

The recycling rules are aimed at deterring large scale recycling, and this lower level of funds is not in their scope, even if your were breaking any of the other rules, which you are probably not.

dunstonh

Two years ago when I stopped working I opened a wealthify sipp 

They don't offer a SIPP.   (pedantic I know but your comment made me look to see if they had changed their product offering.  They haven't.  They also haven't changed the bit on their website where they say you get 25% tax relief)

 but don't want to fall foul of recycling rules.

You won't do.  The non-earners limit does not fall foul of the recycling rules.

Should I take it all (or leave a £1?) and can I then pay in £2880 in the new financial year? 

Some providers will close the product if you take the balance to zero.  Some will keep it open for a period after.  You will need to ask the provider.