USS vs TPS University Pension advice needed

MPLMPL

Been meaning to reply to this thread, but always reading on my phone, so haven't got around to it. 
My rationale is the first two paragraphs of the bit you quoted from my post.
To allow me the option to drawdown the SIPP and delay taking the DB pension to reduce ERFs. You can do this by leaving the money invested in the IB and using this (the IB) to bridge the gap before taking the DB pension, BUT as soon as you take income from the IB, you sever the link with the DB pension and will only ever get 25% of it tax free.
By transferring the entirety to a SIPP and then  building the IB back up, I'll be able to take almost all of the IB I've continued to contribute to tax free, by taking it when I take my DB pension.
USS don't allow partial transfers out, so I transferred the entirety out a couple of years before my planned retirement date, to give me time to build it back up. 

Pythagorous

MPLMPL said:

Been meaning to reply to this thread, but always reading on my phone, so haven't got around to it. 
My rationale is the first two paragraphs of the bit you quoted from my post.
To allow me the option to drawdown the SIPP and delay taking the DB pension to reduce ERFs. You can do this by leaving the money invested in the IB and using this (the IB) to bridge the gap before taking the DB pension, BUT as soon as you take income from the IB, you sever the link with the DB pension and will only ever get 25% of it tax free.
By transferring the entirety to a SIPP and then  building the IB back up, I'll be able to take almost all of the IB I've continued to contribute to tax free, by taking it when I take my DB pension.
USS don't allow partial transfers out, so I transferred the entirety out a couple of years before my planned retirement date, to give me time to build it back up. 

@MPLMPL
Thank you for the additional info.

Can I check the bold part, please? Do you mean, if you take the IB pot earlier than the RB pension you will only ever get the RB cash tax free and none of the IB pot tax free?

The above also seems to imply that if you want to maximise your TFLS, but not take the DB RB pension early, then you will need to hold off taking any TFLS until you start your DB pension at NRA. Is that correct? I would have thought that starting your SIPP drawdown early, before you hit NRA, would allow you to take 25% of whatever you drawdown from it tax free (which would then be netted off your total pension value (using 20 times the DB pension+IB pot+SIPP pot) when it comes to taking your RB cash and anything else in the IB at NRA. Is this incorrect?

Apologies, my head is a bit muddled from all this!

Pythagorous

Pythagorous said:

MPLMPL said:

Been meaning to reply to this thread, but always reading on my phone, so haven't got around to it. 
My rationale is the first two paragraphs of the bit you quoted from my post.
To allow me the option to drawdown the SIPP and delay taking the DB pension to reduce ERFs. You can do this by leaving the money invested in the IB and using this (the IB) to bridge the gap before taking the DB pension, BUT as soon as you take income from the IB, you sever the link with the DB pension and will only ever get 25% of it tax free.
By transferring the entirety to a SIPP and then  building the IB back up, I'll be able to take almost all of the IB I've continued to contribute to tax free, by taking it when I take my DB pension.
USS don't allow partial transfers out, so I transferred the entirety out a couple of years before my planned retirement date, to give me time to build it back up. 

@MPLMPL
Thank you for the additional info.

Can I check the bold part, please? Do you mean, if you take the IB pot earlier than the RB pension you will only ever get the RB cash tax free and none of the IB pot tax free?

The above also seems to imply that if you want to maximise your TFLS, but not take the DB RB pension early, then you will need to hold off taking any TFLS until you start your DB pension at NRA. Is that correct? I would have thought that starting your SIPP drawdown early, before you hit NRA, would allow you to take 25% of whatever you drawdown from it tax free (which would then be netted off your total pension value (using 20 times the DB pension+IB pot+SIPP pot) when it comes to taking your RB cash and anything else in the IB at NRA. Is this incorrect?

Apologies, my head is a bit muddled from all this!

For context, I'm trying to figure out how best to draw down all my SIPP and IB pots before NRA (ie to be used as a bridge to NRA) whilst maximising my 25% tax free allowance and not taking the DB RB pension early. Any advice or thoughts gratefully received!

MPLMPL

Can I check the bold part, please? Do you mean, if you take the IB pot earlier than the RB pension you will only ever get the RB cash tax free and none of the IB pot tax free?

No. If you take the IB earlier, i.e. you sever the link with the DB part, then you will only get 25% of the IB tax free (in addition to your 3XDB PCLS).

The above also seems to imply that if you want to maximise your TFLS, but not take the DB RB pension early, then you will need to hold off taking any TFLS until you start your DB pension at NRA. Is that correct?

Yes, if you don't want to take your DB benefits early. Clearly, you don't need to wait until your NRA to take the DB pension, you can take it early subject to early retirement factors; the DB pension reduced by early retirement is smaller, hence max TFLS is smaller. If you want to maximise the TFLS then you need to avoid accessing the IB (e.g. by UFPLS) to maintain the link with the DB pension. Transferring out before retirement and building up again with further contributions maintains the link, but that link is only to the additional contributions you make to the IB after you have made a transfer out to a SIPP (the link to the transferred out money is lost, this is then in a SIPP and 25% if it is available tax free).

I would have thought that starting your SIPP drawdown early, before you hit NRA, would allow you to take 25% of whatever you drawdown from it tax free (which would then be netted off your total pension value (using 20 times the DB pension+IB pot+SIPP pot) when it comes to taking your RB cash and anything else in the IB at NRA. Is this incorrect?

Not sure what you mean? Once it's transferred out, it's gone. The money in the SIPP is no longer linked to USS. 25% of the SIPP can be taken tax free, but it no longer enters the equation when calculating the max TFLS from your USS IB.

MPLMPL

For context, I'm trying to figure out how best to draw down all my SIPP and IB pots before NRA (ie to be used as a bridge to NRA) whilst maximising my 25% tax free allowance and not taking the DB RB pension early. Any advice or thoughts gratefully received!

If you plan to draw down all of the SIPP and IB before taking your DB, then you will only be able to take 25% tax fee (25% of SIPP will be tax free and 25% of the IB will be tax free). You can only get more than 25% tax free from your IB by not drawing on it and maintaining the link between the IB and DB, i.e. taking it at the same time as your DB.