Continuing to pay into a DCP after starting to receive income from a deferred FSP - payments limit

IanChello

Hi, I’m still a full-time employee but intend going to 3days a week starting January.  I was made redundant at 15 years ago and became a deferred member of the final salary pension I had been in.  I wanted this to start paying out for when I go part time to top up my income.  I have been paying into a money purchase scheme (DCP) in my new employment which I was going to continue.  A friend has informed my that once I start drawing my deferred final salary pension I am limited on how much I can pay into my current DCP.  Is this so and what are the limits?

Marcon

IanChello said:

Hi, I’m still a full-time employee but intend going to 3days a week starting January.  I was made redundant at 15 years ago and became a deferred member of the final salary pension I had been in.  I wanted this to start paying out for when I go part time to top up my income.  I have been paying into a money purchase scheme (DCP) in my new employment which I was going to continue.  A friend has informed my that once I start drawing my deferred final salary pension I am limited on how much I can pay into my current DCP.  Is this so and what are the limits?

Ignore your friend (although perhaps point out gently that they are wrong, so they don't mislead anyone else). If you are drawing benefits from a final salary scheme, then the Money Purchase Annual Allowance isn't triggered.