Small pot in Vanguard, already taken 25% what now?

gele

I am currently working my notice period leaving full time employment 1st May 
I will be doing some casual work but not sure how much that will bring in so its difficult to plan.
I have a small Vanguard SIPP [under £30k now due to recent events!] and have already taken the 25% tax free. I am considering taking some taxable drawdown now as the pot is small anyway but am not a whizz where tax is concerned [I've always been PAYE] and am not sure how and when the tax is taken. I may find I earn less that the £12570 personal allowance over the year anyway.  Can someone enlighten me as to how and when tax is taken if for example I was to take £3k lump or set up a monthly drawdown of £250. Thanks in advance 

Marcon

gele said:

I am currently working my notice period leaving full time employment 1st May 
I will be doing some casual work but not sure how much that will bring in so its difficult to plan.
I have a small Vanguard SIPP [under £30k now due to recent events!] and have already taken the 25% tax free. I am considering taking some taxable drawdown now as the pot is small anyway but am not a whizz where tax is concerned [I've always been PAYE] and am not sure how and when the tax is taken. I may find I earn less that the £12570 personal allowance over the year anyway.  Can someone enlighten me as to how and when tax is taken if for example I was to take £3k lump or set up a monthly drawdown of £250. Thanks in advance 

The pension provider will tax each withdrawal at the time you make it. Good explanation/calculator here: https://www.hl.co.uk/retirement/preparing/tax-matters/emergency-calculator

dunstonh

 but am not a whizz where tax is concerned [I've always been PAYE] and am not sure how and when the tax is taken. 

The good news is that both drawdown and annuity use PAYE.

ColdIron

gele said:

I am considering taking some taxable drawdown now as the pot is small anyway but am not a whizz where tax is concerned [I've always been PAYE] and am not sure how and when the tax is taken.

You're in luck then as your pension provider will employ PAYE just like your previous employer(s) did. They will even produce a P60 for you each year

gele

Marcon said:

gele said:

I am currently working my notice period leaving full time employment 1st May 
I will be doing some casual work but not sure how much that will bring in so its difficult to plan.
I have a small Vanguard SIPP [under £30k now due to recent events!] and have already taken the 25% tax free. I am considering taking some taxable drawdown now as the pot is small anyway but am not a whizz where tax is concerned [I've always been PAYE] and am not sure how and when the tax is taken. I may find I earn less that the £12570 personal allowance over the year anyway.  Can someone enlighten me as to how and when tax is taken if for example I was to take £3k lump or set up a monthly drawdown of £250. Thanks in advance 

The pension provider will tax each withdrawal at the time you make it. Good explanation/calculator here: https://www.hl.co.uk/retirement/preparing/tax-matters/emergency-calculator

Thanks I will have a read and thanks to other posters too. Got to decide now how and when to take the money as I will have small LGPS pension paying out too. with all the turbulence at the moment Im not sure I want to wait to ride it out-especially if it takes a couple of years