Is this UFPLS without calling it such?

Prism

squirrelpie said:

Prism said:

Option one could be flexi-access drawdown too, doesn't have to be UFPLS

How do you work that out?

Why do you think it couldn't be? FAD allows you to take a amount of your choosing, with 25% tax free and 75% taxed. Or you can do other things with it.

squirrelpie

No FAD allows you to crystallize some money (i.e. move it within the pension), withdraw up to 25% tax free and then arrange to withdraw taxable amounts as and when required. If you withdraw all the taxable amount immediately and are not able to arrange separate withdrawals (as the OP said), it is UFPLS.

Prism

squirrelpie said:

No FAD allows you to crystallize some money (i.e. move it within the pension), withdraw up to 25% tax free and then arrange to withdraw taxable amounts as and when required. If you withdraw all the taxable amount immediately and are not able to arrange separate withdrawals (as the OP said), it is UFPLS.

Sure, UFPLS does that. And you can do exactly the same with FAD if you want. You don't need to take an income from the taxable part. You can take it as a lump sum and pay the tax on it just like UFPLS. 

squirrelpie

Yes, but the reverse is not true. And that's what matters here.

gm0

The quoted text does not specify some important things e.g. about taking a partial amount of benefits into use, or making a partial transfer out. The phrasing around can only do it once is a bit ambiguous. For a non-UFPLS all at once event.  i.e. a FAD TFC and mark for income not yet taken event - of either a full or a partial amount of a DC pot - you can only do the TFC part once. Take it or not take it.  But it doesn't talk about partials at all.  Suggestive they are not supported.  But the phrases describing each option could still be true if it was. 

If "partial" taking of benefits (and of transfer) is supported then there is a lot more flexibility to make use of what is good about the existing scheme vs other options as may exist elsewhere. 

This is a key fact to establish. Taking 50% into drawdown.  50% untouched.  Or 50% transfer out. 
Prices, and the use of insured funds and protection will be a likely difference in the details.

I did partial transfers from an old DC occupational (not this one) to a 3rd party (for more range) and to the house option. The 2nd because it was cheap enough. And it used insured fund types only - at good fund management prices (so 100% FSCS protection retained as prior) for no premium.  My cost "premium" for having two providers - with half of it 100% insured funds is very small (if it exists at all).

This type of range/cost/service/protection calculation will be - scheme specific - based on the menu and prices.

So a key fact to establish.

arthur_fowler

Thanks everyone. I will need to spend more time understanding the difference between FAD and UFPLS, whether my current provider's options limit what I want to do (currently planning on using an annuity but depends on rates between now and retirement in two years) and their charges.