PCLS in 2023/2024 where LTA exceeds 1,070,000

Albermarle

davec1001 said:

Pat38493 said:

FIREDreamer said:

jamesd said:

But there's transitional protection:

"where the actual amount of tax free amounts received is lower than the default amount a scheme member can apply for a “transitional tax free amount certificate”.   Where a certificate is held then the LSA reduction is based on the certified amount not the default calculation amount."

"Geoff used 50% of his LTA.  This was used by taking £125,000 PCLS and putting £375,000 into drawdown when the LTA was £1million.  His LSA is reduced by 50% x £1,073,100 x 25% = £134,137.50.  

As his actual tax free cash is lower than £134,137.50 he can apply for a certificate showing £125,000 as his transitional tax free amounts.  His available LSA would be £143,275 instead of £134,137.50.  His available LSDBA is £948,100 instead of £938,962.50."

This does seem to be an area where further clarification would be useful.

Would a letter confirming I took a DB of £x with no PCLS (because DB = Revalued GMP) from the DB scheme when I took the pension (quoting LTA percentage) be sufficient proof or is a formal certificate be required?

The guidelines that was published earlier suggested you will need to apply for a formal certificate but the processs and nature of the evidence required has not been clarified.  I am sure it will all be in place and 100% clear by 6th April.  Or not.

Sigh, sounds like you are in the same place as me.    I have actually sent an enquiry to my DB provider and asked for proof / certificate.   I await their answer.

Based on the past performance of my DB pension administrator ( Mercer), any enquiry like this will inevitably fall into a black hole. Once the rules are clearer, and things have settled down I will try then. 

Somebody

Albermarle said:

Based on the past performance of my DB pension administrator ( Mercer), any enquiry like this will inevitably fall into a black hole. Once the rules are clearer, and things have settled down I will try then. 

I find Mercer to be not too bad.  On my scheme's portal, I can track any questions asked under Case Tracking, where they commit to a response date, and close when completed.

"If you have requested information from us, you can track the progress of your case here. Please note that only information requested after 01/01/2020 will be available for viewing online. If you have recently submitted an online enquiry, the information will be available within 24 hours."

tiring33

A recent article on this issue which you may find useful, see Question 7.

https://mcl.accountants/news/abolition-of-the-lta/

Albermarle

Somebody said:

Albermarle said:

Based on the past performance of my DB pension administrator ( Mercer), any enquiry like this will inevitably fall into a black hole. Once the rules are clearer, and things have settled down I will try then. 

I find Mercer to be not too bad.  On my scheme's portal, I can track any questions asked under Case Tracking, where they commit to a response date, and close when completed.

"If you have requested information from us, you can track the progress of your case here. Please note that only information requested after 01/01/2020 will be available for viewing online. If you have recently submitted an online enquiry, the information will be available within 24 hours."

AIUI, it depends on your scheme, and which bit of Mercer you are dealing with. There was no online tracking portal I could use when dealing with them in 2021.

Somebody

Albermarle said:

AIUI, it depends on your scheme, and which bit of Mercer you are dealing with. There was no online tracking portal I could use when dealing with them in 2021.

My portal starts with v3.merceroneview.co.uk

tim9333

Having watched the AJBell "Life after the lifetime allowance" video, can someone explain the difference between taking death benefits as income vs taking a lump sum?

Specifically.

If someone does under the age of 75, benefits that are taken as income are currently tax free

But benefits that are taken as a lump sum are taxed at the beneficiary's marginal rate if they exceed the new LSDBA limit

But can a beneficiary simply drawdown their total pot in say 12 monthly installments and is that still classified as income?

If so, when does income become a lump sum?

Am I missing something?