Pension lump sum and ESA

mazworld15

NedS said:

mazworld15 said:

kaMelo said:

mazworld15 said:

Thinking if she takes the tax free bit (about 4k) and transfers the rest to a SIPP ? Could she then drawdown when she's used the 4k or would ESA see it as she's had the whole 14k as its in drawdown? tia

Does she have any earned income?

If not the maximim she can put in a SIPP would be £2880 per tax year.

No she doesn't, didn't think of that

She doesn't need income to do a pension transfer. If the current pension provider does not allow the flexibility to take the pension in that way (tax free lump sum followed by regular drawdown), they could transfer the pension to a SIPP which would allow that flexibility.

What she cannot do is withdraw the pension funds and then pay them back into a SIPP (without relevant earned income) as new pension contributions.

Sorry for all the questions, the bit that goes to the Sipp wouldn't be counted as saving and wouldn't affect her ESA? Is that right? tia