Defined Contribution questions…

Sunsh1ne54

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

bluebirdy

I don’t know the answer but that’s an interesting question and I think what I’ve been trying to work out too. I have a mixed pension (USS) with DB and DC parts and I’d v much like to know what happens to the DC options if I flex retired (and maximising lump sum also) but want to keep adding to it.

sevenhills

Sunsh1ne54 said:

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

Is this a workplace private pension, more details are required. Is this a workplace pension?

Sunsh1ne54

sevenhills said:

Sunsh1ne54 said:

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

Is this a workplace private pension, more details are required. Is this a workplace pension?

Yes, a workplace pension that both my employer and I contribute to

Dazed_and_C0nfused

Sunsh1ne54 said:

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

AIUI there will be two pots, the crystallised part and the new contributions part but I think it varies from provider to provider exactly how this is shown within your pension.

Whatever the crystallised elements grows to (or drops to) would all be taxable when taken and the new contributions would still allow 25% TFLS to be taken.

Albermarle

Some providers will have two clearly separate pots - crystallised and uncrystallised. Some have one pot with a % figure of how much of it is crystallised.
I think with some providers you actually end up with two separate pensions.
In any case it should not cause any issues.

dunstonh

Sunsh1ne54 said:

sevenhills said:

Sunsh1ne54 said:

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

Is this a workplace private pension, more details are required. Is this a workplace pension?

Yes, a workplace pension that both my employer and I contribute to

Does the workplace pension support income drawdown?  Most workplace pensions do not or have limited functionality where they put clauses in place or restrict the options.

Sunsh1ne54

dunstonh said:

Sunsh1ne54 said:

sevenhills said:

Sunsh1ne54 said:

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

Is this a workplace private pension, more details are required. Is this a workplace pension?

Yes, a workplace pension that both my employer and I contribute to

Does the workplace pension support income drawdown?  Most workplace pensions do not or have limited functionality where they put clauses in place or restrict the options.

It’s Scottish Widows, yes it does

Sunsh1ne54

Dazed_and_C0nfused said:

Sunsh1ne54 said:

Hi
Following on from my previous post, if I draw my tax free lump sum from my DC pension, I understand my remaining funds in the pot are crystallised. I would still be working and adding to this pension…will this go into another pot? The original crystallised funds then sit in a separate pot until I decide to drawdown or buy an annuity? Can the latter be done at a later date if I choose that option?  Is my understanding correct please? Many thanks 

AIUI there will be two pots, the crystallised part and the new contributions part but I think it varies from provider to provider exactly how this is shown within your pension.

Whatever the crystallised elements grows to (or drops to) would all be taxable when taken and the new contributions would still allow 25% TFLS to be taken.

That’s what I thought, but wasn’t sure about any growth being a quarter tax free on the crystallised pot…

Albermarle

, but wasn’t sure about any growth being a quarter tax free on the crystallised pot…

It isn't.

It’s Scottish Widows, yes it does

However I think ( not sure ) that you are changed into a separate retirement account when you start drawdown. Then maybe keep the current one for new contributions. You need to check the details with them/on their website.

Sunsh1ne54

Albermarle said:

, but wasn’t sure about any growth being a quarter tax free on the crystallised pot…

It isn't.

It’s Scottish Widows, yes it does

However I think ( not sure ) that you are changed into a separate retirement account when you start drawdown. Then maybe keep the current one for new contributions. You need to check the details with them/on their website.

Thanks, I thought that might be the case