Flexi draw down question if I may.

User1783

RoysV said:

As @Albermarle suggests you could just crystallise £16760/ year and take the 25% tax free cash and income of £12570. Unless of course you have a plan for the "big lump" that's what I'm planning on doing. Well after I've checked that my SIPP platform allow it. As I've found out the more I think I know the less I actually do!

The reason I chose £20k for the yearly lump sum is so that it could be reinvested in S&S ISA and utilise the full allowance. Ultimately, I'm trying to take everything out of the penion in the quickest and most tax efficient way possible (i.e. no income tax). Once I have the money out I will reinvest or spend as required. Thanks for your comment.

Albermarle

User1783 said:

RoysV said:

As @Albermarle suggests you could just crystallise £16760/ year and take the 25% tax free cash and income of £12570. Unless of course you have a plan for the "big lump" that's what I'm planning on doing. Well after I've checked that my SIPP platform allow it. As I've found out the more I think I know the less I actually do!

The reason I chose £20k for the yearly lump sum is so that it could be reinvested in S&S ISA and utilise the full allowance. Ultimately, I'm trying to take everything out of the penion in the quickest and most tax efficient way possible (i.e. no income tax). Once I have the money out I will reinvest or spend as required. Thanks for your comment.

Transferring £20K of tax free cash from a pension to a S&S ISA, does not really achieve anything, unless there are investments available in the S&S ISA that you want, and there are not similar investments available in the pension.

User1783

Transferring £20K of tax free cash from a pension to a S&S ISA, does not really achieve anything, unless there are investments available in the S&S ISA that you want, and there are not similar investments available in the pension.

I was under the impression that S&S ISAs are more accessible/flexible and less likely to be impacted by potential rule changes. Is that not really the case?
Maybe I'm needlessly overthinking but I see ISA investments as "all mine" (they won't be taxed) whereas pensions are "potentially all mine" (may get taxed) so the sooner I can get the money out (efficiently) the better.
My approach is also influenced by having 5 workplace pensions and wanting to ease the administrative burden (I may amalgamate them but that's a whole different topic).

MallyGirl

User1783 said:

Transferring £20K of tax free cash from a pension to a S&S ISA, does not really achieve anything, unless there are investments available in the S&S ISA that you want, and there are not similar investments available in the pension.

I was under the impression that S&S ISAs are more accessible/flexible and less likely to be impacted by potential rule changes. Is that not really the case?
Maybe I'm needlessly overthinking but I see ISA investments as "all mine" (they won't be taxed) whereas pensions are "potentially all mine" (may get taxed) so the sooner I can get the money out (efficiently) the better.
My approach is also influenced by having 5 workplace pensions and wanting to ease the administrative burden (I may amalgamate them but that's a whole different topic).

That is a reasonable approach. Getting money out of a pension can be more effort - depending on the pension provider. There may be forms to fill in each time whereas with an ISA it is more like a simple withdrawal (assuming holding cash).

QrizB

Gordon_T_2 said:

The wife is in an NHS DB scheme and her pension entitlements cant be added to.

Your wife has more options than most for additional pension, either within the NHS scheme or separately.

For example she could open a personal pension with one of the many providers that get regularly discussed here. For each £8k she pays in, she'll get £2k added by the government. Once inside the pension wrapper she can invest it in a similar way to the ISA.

If she then takes it out again in three years time, she'll pay no tax on 25% of it and will be at least 6.25% better off than leaving it in the ISA.

Albermarle

My approach is also influenced by having 5 workplace pensions and wanting to ease the administrative burden (I may amalgamate them but that's a whole different topic).

Better to amalgamate them before taking any tax free cash, as it can be more complicated transferring crystallised funds.

User1783

Thanks all for your comments and insights.