Paying and drawing at the same time

Alitree

I already draw a workplace pension every month and also pay into another workplace pension , can i pay more into the new one ? will i pay extra tax and are there limits? 

NoMore

It depends, as always the devil is in the details.

What type of pension are you currently drawing from DB or DC ? If DC how much have you drawn and how as if you have took more than the tax free amount, you have triggered the MPAA. Which I believe has just been raised from 4k p.a. to 10k p.a. by the chancellor from April 23

Alitree

Hi Thanks for responding
What are DB, DC and MPAA 

NoMore

DB - Defined Benefit this is a employer pension where the amount you get is based on your years service and salary and as such is usually a fixed amount each month you get

DC - Defined contribution, this is just a large pot of money, and you can choose how much to withdraw at any time.

MPAA - the money purchase annual allowance, this is triggered if you take taxable income from a DC pension and then limits you to 4k (rising to 10k in April) yearly contributions to other pensions. This is the thing we need to establish if you have triggered in order to answer your original question.

Albermarle

Pension basics | Help with pension basics | MoneyHelper

Alitree

I took a lumpsum of 10k and also take a monthly income from it so guess its DC

CharlieCR

I am drawing on a private pension and would like to start paying into it at the same time to boost it up. Can I do this? Or do I have to stop drawing on it and just pay in to draw on it later? etc!

Linton

CharlieCR said:

I am drawing on a private pension and would like to start paying into it at the same time to boost it up. Can I do this? Or do I have to stop drawing on it and just pay in to draw on it later? etc!

You can pay in at the same time you take money out.  Though this is a complex area called pension recycling as HMRC dont like you getting 25% tax free on money for which you have already received 25% tax free.  However if your contributions are less than £7500 in a tax year its not an issue.

Albermarle

CharlieCR said:

I am drawing on a private pension and would like to start paying into it at the same time to boost it up. Can I do this? Or do I have to stop drawing on it and just pay in to draw on it later? etc!

Should be possible, but you would need to check with your provider first. Older pensions tend to be less flexible generally.

xylophone

I took a lumpsum of 10k and also take a monthly income from it so guess its DC

Not necessarily - don't guess, check!

https://www.gov.uk/pension-types#:~:text=defined contribution - a pension pot,ve worked for your employer

Could you give details of the pension you are drawing?

Have you yet reached State Pension Age?

If not, have you checked your state pension forecast for planning purposes?

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

NoMore

xylophone said:

I took a lumpsum of 10k and also take a monthly income from it so guess its DC

Not necessarily - don't guess, check!

https://www.gov.uk/pension-types#:~:text=defined contribution - a pension pot,ve worked for your employer

Could you give details of the pension you are drawing?

Have you yet reached State Pension Age?

If not, have you checked your state pension forecast for planning purposes?

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

You are quoting the OP who made that post over a year ago and also hasn't been back since. The thread has been revived by a new poster, who probably should have started their own thread instead.