SIPP Withdrawal? 3 March at 12:14PM in Savings & investments 2 replies 259 views

junebaby

I have a SIPP with Hargreaves Lansdown that has built up for many years by adding £2880 and receiving the Government top up. 

It now totals just under £20,000. I have taken 2 withdrawals so it is now crystallised (think that is the term). Roughly £7,000 is in cash the rest is invested. 

I am now unsure what to do with this SIPP for the following reasons. I will reach state pension age in June and will no longer be a non tax payer so will not be adding any more to it. I have £5,000 unused tax allowance for this tax year. My question is how much can I withdraw tax free or would I be better closing the SIPP and investing the money elsewhere?

I have no need for this money for the foreseeable future but would still like it to work for me. 

I would appreciate any comments. 

dunstonh

It now totals just under £20,000. I have taken 2 withdrawals so it is now crystallised (think that is the term). Roughly £7,000 is in cash the rest is invested. 

The crystallised/uncrystallised state will depend on how you did the withdrawals.  For example, did you use UFPLS or drawdown. If drawdown, did you only draw the 25% TFC or did you did you take some of the 75% as well?

I am now unsure what to do with this SIPP for the following reasons. I will reach state pension age in June and will no longer be a non tax payer so will not be adding any more to it.

Why do you think that not being a non-taxpayer means you shouldn't be adding to it?

. I have £5,000 unused tax allowance for this tax year. My question is how much can I withdraw tax free or would I be better closing the SIPP and investing the money elsewhere?

a) why do you need to draw any? (what are you going to do with the money drawn)
b) why do you think it may be a good idea to draw it and use a different wrapper?

We have to throw some questions back at you because there is insufficient information to answer.

If you have £5000 personal allowance left then the 75% element of the draw can equal £5000 (with the 25% on top, if using UFPLS - if any uncrystallised left)

I have no need for this money for the foreseeable future but would still like it to work for me. 

This would suggest that the pension wrapper is still suitable.

Albermarle

I will reach state pension age in June and will no longer be a non tax payer so will not be adding any more to it.

As far as pension contributions are concerned, what matters is how much taxable earnings you have. If you have none ( and the state pension does not count as taxable earnings, although it is taxable of course) then the maximum you can add to a pension is £3600 pa ( £2880 from you and £720 tax relief added)
The fact that you might be paying tax on other income, like pensions, or rental income etc is not relevant to how much you can add.