We’d like to remind Forumites to please avoid political debate on the Forum.

This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
The Forum now has a brand new text editor, adding a bunch of handy features to use when creating posts. Read more in our how-to guide

DB Pension and UFPLS

I have a DB pension that can be taken at 55 which will pay a lump sum and an annual income of £8000.00 which I intend to take in the 2025/2026 tax year. What is the maximum I can also take from my DC pension before I start to pay tax. Personal allowance of £12570.00 less £8000.00 leaves £4570.00 of personal allowance. Would the maximum UFPLS i can take be £4570.00 + 25% tax free so £5712.50 giving a tax free income for the year of £13712.50?

Comments

  • Mark_d
    Mark_d Posts: 2,748 Forumite
    1,000 Posts Second Anniversary Name Dropper
    looks correct to me
  • Albermarle
    Albermarle Posts: 30,473 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    No it is not correct.

    A UFPLS payments is 25% tax free and 75% taxable .
    If the taxable part is £4570 , then the tax free part will be one third of that = £1523.
    So in total you can take a UFPLS payment of £1523 + £4570 = £6093.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 353.6K Banking & Borrowing
  • 254.2K Reduce Debt & Boost Income
  • 455.1K Spending & Discounts
  • 246.7K Work, Benefits & Business
  • 603K Mortgages, Homes & Bills
  • 178.1K Life & Family
  • 260.7K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 37.7K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.