State Pension and private Pension

I have a private pension but have only withdrawn the tax free amount hence at present I am not a tax-payer and therefore receive my full state pension.  If I withdraw £10K from my private pension how does that impact on my non tax payer status?  I realise I would no longer get the full state pension but is that then readjusted in the next financial year or does my one off £10K withdrawal from the private pension make me a tax-payer for the foreseeable future? 

Comments

  • TadleyBaggie
    TadleyBaggie Posts: 6,538 Forumite
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    You will always get your full state pension, the state pension is never taxed at source. Any tax due to exceeding your personal allowance would need to come from your private pension income.
  • Old_Possum
    Old_Possum Posts: 14 Forumite
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    edited 10 June 2024 at 11:56AM
    Thanks for that but why then does my other half get slightly less state pension than me despite likewise working all his life?  He does have a company pension and that is taxed at source.
  • MallyGirl
    MallyGirl Posts: 7,152 Senior Ambassador
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    it will be related to his working history - being contracted out for example will affect what he gets
    I’m a Senior Forum Ambassador and I support the Forum Team on the Pensions, Annuities & Retirement Planning, Loans
    & Credit Cards boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com.
    All views are my own and not the official line of MoneySavingExpert.
  • Albermarle
    Albermarle Posts: 27,061 Forumite
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    Be aware that when you withdraw the £10K it may well get overtaxed as they will apply an emergency tax code.
    This would happen whether you were drawing the state pension or not.
    You will probably have to give HMRC a call at some point to sort it out.
    Taking one off/irregular payments tends to often cause problems and paying too much tax. Especially as in your case you maybe a taxpayer one year, and then not the next. However you will get back any tax you have overpaid at some point.
  • badmemory
    badmemory Posts: 9,387 Forumite
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    Is it possible to take out a small amount until HMRC issue a tax code & then take out the larger amount?
  • MallyGirl
    MallyGirl Posts: 7,152 Senior Ambassador
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    badmemory said:
    Is it possible to take out a small amount until HMRC issue a tax code & then take out the larger amount?
    yes it is 
    I’m a Senior Forum Ambassador and I support the Forum Team on the Pensions, Annuities & Retirement Planning, Loans
    & Credit Cards boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com.
    All views are my own and not the official line of MoneySavingExpert.
  • molerat
    molerat Posts: 34,277 Forumite
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    MallyGirl said:
    badmemory said:
    Is it possible to take out a small amount until HMRC issue a tax code & then take out the larger amount?
    yes it is 
    But the tax free amounts will be X 12ths of the total allowance so may have to wait several months to get the maximum tax free amount.

  • badmemory
    badmemory Posts: 9,387 Forumite
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    So would I be right in thinking - take a small amount now, then the larger amount when you get the tax code, then a small amount in March - would make the tax paid correct?
  • molerat
    molerat Posts: 34,277 Forumite
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    badmemory said:
    So would I be right in thinking - take a small amount now, then the larger amount when you get the tax code, then a small amount in March - would make the tax paid correct?
    Yes, any overpaid tax from the earlier payments would be refunded in March.

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