Small pots question

eastcorkram

I used the small pots method , to close a fidelity sipp in May. The balance was £8575.73. Tax free was £2143.93. Tax paid on the remainder, £1286.20. Therefore paid to me, £7289.53.

Two questions. 

I'd assumed this would close that sipp . Indeed, the balance reduced to zero, and the final letter states, Your account is now closed. I was going to uninstall the app yesterday, but decided to log in. There is now a balance of £22.50, which is interest that's been added. Can I still contribute to this SIPP now? Maybe I need to call them ....

Secondly, at the time, 13th May, they sent me in the post, a P45. Am I supposed to do anything with this? When I log into personal tax account, there's no mention of any income from fidelity. The only income listed is a DB pension. Amount of tax expected to pay this year, is zero. That's sort of correct, but state pension starting this tax year will change that. So, I've already paid £1286.20 tax this year, but there's no mention of that in the personal tax account. I'm not bothered about reclaiming that, but should HMRC be showing that? Or am I meant to post the P45 to them? 

Dazed_and_C0nfused

eastcorkram said:

I used the small pots method , to close a fidelity sipp in May. The balance was £8575.73. Tax free was £2143.93. Tax paid on the remainder, £1286.20. Therefore paid to me, £7289.53.

Two questions. 

I'd assumed this would close that sipp . Indeed, the balance reduced to zero, and the final letter states, Your account is now closed. I was going to uninstall the app yesterday, but decided to log in. There is now a balance of £22.50, which is interest that's been added. Can I still contribute to this SIPP now? Maybe I need to call them ....

Secondly, at the time, 13th May, they sent me in the post, a P45. Am I supposed to do anything with this? When I log into personal tax account, there's no mention of any income from fidelity. The only income listed is a DB pension. Amount of tax expected to pay this year, is zero. That's sort of correct, but state pension starting this tax year will change that. So, I've already paid £1286.20 tax this year, but there's no mention of that in the personal tax account. I'm not bothered about reclaiming that, but should HMRC be showing that? Or am I meant to post the P45 to them? 

You shouldn't need to post the P45 to them.

But if the pension was paid in this current tax year I would have thought you should see that on your tax account.  Is the "leaving date" on the P45 in May 2025?

eastcorkram

Yes, it's 13/05/2025. 
I would have thought it would show up by now, but I suppose it could take several weeks to appear. I'll keep my eye on it. 
Thanks. 

squirrelpie

eastcorkram said:

I'd assumed this would close that sipp . Indeed, the balance reduced to zero, and the final letter states, Your account is now closed. I was going to uninstall the app yesterday, but decided to log in. There is now a balance of £22.50, which is interest that's been added. Can I still contribute to this SIPP now? Maybe I need to call them ....

Assuming that you understand where the interest has come from, then yes I think you need to contact them and ask them what's happening to the interest. Will they pay it to you automatically or do you need to do something? Why would you want to contribute to a SIPP that you closed? If you want to open another one, I would open a new one.

eastcorkram

squirrelpie said:

eastcorkram said:

I'd assumed this would close that sipp . Indeed, the balance reduced to zero, and the final letter states, Your account is now closed. I was going to uninstall the app yesterday, but decided to log in. There is now a balance of £22.50, which is interest that's been added. Can I still contribute to this SIPP now? Maybe I need to call them ....

Assuming that you understand where the interest has come from, then yes I think you need to contact them and ask them what's happening to the interest. Will they pay it to you automatically or do you need to do something? Why would you want to contribute to a SIPP that you closed? If you want to open another one, I would open a new one.

I don't particularly want to contribute to it. I have other SIPPS for that. I was just wondering, as I have a letter a month ago, saying it's closed, yet I can still log in, and it appears to be open . I'll call them. 

Marcon

You certainly don't want to contribute to it, or the withdrawal will lose its 'small pots' status and you'll have irreversibly triggered the MPAA.

Albermarle

eastcorkram said:

Yes, it's 13/05/2025. 
I would have thought it would show up by now, but I suppose it could take several weeks to appear. I'll keep my eye on it. 
Thanks. 

I took two small pots in 24/25 tax year.
They were both visible in my personal tax account, but I do not know how long it took between taking them, and them appearing.
In fact one of them appeared twice, and I had to phone HMRC who said I had to go back to the provider, who eventually sorted it.

eastcorkram

Ok. So, I called them. They said they'll have to send me the current balance. It'll probably happen towards the end of next week. 
Now, bearing in mind they've already paid me 25% tax free, and the rest taxed, and a P45, I'm not sure how much exactly, I'll receive! 

He didn't know what I should do with the P45. He said, everyone's different and it depends on your personal circumstances.

I'd assumed that when the account was getting closed, they'd have calculated the up to date balance on that last day, but apparently not. 

Albermarle

eastcorkram said:

Ok. So, I called them. They said they'll have to send me the current balance. It'll probably happen towards the end of next week. 
Now, bearing in mind they've already paid me 25% tax free, and the rest taxed, and a P45, I'm not sure how much exactly, I'll receive! 

He didn't know what I should do with the P45. He said, everyone's different and it depends on your personal circumstances.

I'd assumed that when the account was getting closed, they'd have calculated the up to date balance on that last day, but apparently not. 

It might have been a dividend payment ?

dunstonh

That isn't very good.
Most platforms do not close the account immediately because interest and other distributions are commonplace.   They wait for 3-6 months and then mop up any residual balance and then close it and issue the P45.
But then again, most platforms don't support the small pots rule.

Albermarle

dunstonh said:

That isn't very good.
Most platforms do not close the account immediately because interest and other distributions are commonplace.   They wait for 3-6 months and then mop up any residual balance and then close it and issue the P45.
But then again, most platforms don't support the small pots rule.

I took a small pot from both HL and AJ Bell, and they both paid it out pretty quick, and issued the P45 at the same time ( so same as the OP had with Fidelity)