HMRC & UFPLS

dunstonh

sgx2000 said:

Wow harsh replies.....

But Interesting....

Probably my issue is with Aviva
No online simple UFPLS withdrawl request page...

They insist that you phone for each withdrawl

Harsh but said with a smile.  

If you use a modern DIY provider, then their functionality will be geared to the DIY client.
If you use a modern intermediary provider, then their functionality will be geared to the IFA typing it all in on behalf the client.
If you use an old legacy plan with limited functionality that has been bolted at some later point, then its usually paper based or phone based and more work.

My 'screw it up'  comment was because if I withdraw £6K as a one off payment (!/4 of the way though the financial year they instantly change my tax code to assume I will be taking £6k every month for the remainder of the financial year.... or am I completely wrong?

That is not a "screw it up".  That is how PAYE works.   That is why there is a simple online method to request the adjustment.

Is it practical to take UFPLS withdrawals every month (I'm with interactive investor)?  I know there is the drawdown option too, but just wondered if monthly withdrawals are a possibility with UFPLS/ii?

That method is available with most intermediary providers but not as many DIY providers.

Sharktail

snarffie said:

Is it practical to take UFPLS withdrawals every month (I'm with interactive investor)?  I know there is the drawdown option too, but just wondered if monthly withdrawals are a possibility with UFPLS/ii?

Hi
Yes  UFPLS is possible to do monthly with ii that’s what I do ,withdrawal's have to be done manually every month 5-10 mins in total a few basic box ticking questions 3-5 days later the proceeds are in the bank 

Hoenir

sgx2000 said:

Wow harsh replies.....

But Interesting....

These days there's an increasing tendancy to rant and moan from the off. Shoot from the hip and want to blame someone or something.  Rather than ask some questions and a gain comprehension of why things operate in a certain way. Net result is that fewer people comprehend and pass this knowledge on. 

snarffie

Sharktail said:

snarffie said:

Is it practical to take UFPLS withdrawals every month (I'm with interactive investor)?  I know there is the drawdown option too, but just wondered if monthly withdrawals are a possibility with UFPLS/ii?

Hi
Yes  UFPLS is possible to do monthly with ii that’s what I do ,withdrawal's have to be done manually every month 5-10 mins in total a few basic box ticking questions 3-5 days later the proceeds are in the bank 

Thank Sharktail,
Good to hear that it's doable.  I did check ii to see what the process is and it doesn't seem too onerous other than the 10 day wait to receive funds which is easily planned for.  I quite like UFPLS as it avoids the notional crystalized/uncrystallized split which I haven't yet got my head around!

MetaPhysical

Sharktail said:

snarffie said:

Is it practical to take UFPLS withdrawals every month (I'm with interactive investor)?  I know there is the drawdown option too, but just wondered if monthly withdrawals are a possibility with UFPLS/ii?

Hi
Yes  UFPLS is possible to do monthly with ii that’s what I do ,withdrawal's have to be done manually every month 5-10 mins in total a few basic box ticking questions 3-5 days later the proceeds are in the bank 

Is there no way on II to make this a "recurring" payment?  I am also with II and wondered this.

Notepad_Phil

MetaPhysical said:

Sharktail said:

snarffie said:

Is it practical to take UFPLS withdrawals every month (I'm with interactive investor)?  I know there is the drawdown option too, but just wondered if monthly withdrawals are a possibility with UFPLS/ii?

Hi
Yes  UFPLS is possible to do monthly with ii that’s what I do ,withdrawal's have to be done manually every month 5-10 mins in total a few basic box ticking questions 3-5 days later the proceeds are in the bank 

Is there no way on II to make this a "recurring" payment?  I am also with II and wondered this.

I don't think so - I believe AJ Bell does allow monthly UFPLS payments, but I use ii because for me they're far cheaper and so I put up with the slight hassle of manually setting them up (though I'm happy to just do 4 UFPLS payments spread over the year rather than one every month).

Qyburn

sgx2000 said:

My 'screw it up'  comment was because if I withdraw £6K as a one off payment (!/4 of the way though the financial year they instantly change my tax code to assume I will be taking £6k every month for the remainder of the financial year.... or am I completely wrong?

My experience was that I got the excess tax refunded within a few weeks. 

kempiejon

Qyburn said:

sgx2000 said:

My 'screw it up'  comment was because if I withdraw £6K as a one off payment (!/4 of the way though the financial year they instantly change my tax code to assume I will be taking £6k every month for the remainder of the financial year.... or am I completely wrong?

My experience was that I got the excess tax refunded within a few weeks. 

It's a fairly trivial task to claim and check details online, I had a slightly longer experience as my claim for tax back was delayed but about 6 weeks was my experience.

af1963

While those who have commented are correct that "that's how PAYE works", there's no iron law that says it has to be done that way. PAYE was created in a pre-computer age and works very effectively in allowing regular deductions from  weekly or monthly pay by each employer or pension payer, without needing to share any significant amount of personal financial information - just a tax code for each employer, and a lookup in a PAYE table that could be ( and used to always be) done manually.

It also pre-dates the ability to take irregular lump sum income from pensions, which is the way that increasing numbers of retirees will be getting their income. So it will increasingly get more and more of these calculations "wrong" in the first instance if it assumes them to be a monthly income.

If it's possible to do a reclaim process via a quick online claim, it should also be possible to integrate that process into the initial calculation and payment, if the recipient ticks a box that says "this is a one-off payment and not a new monthly income".  At some point, it'll become more cost effective to fix the system to do it right first time rather than paying to process several million regular refunds.

sgx2000

af1963 said:

While those who have commented are correct that "that's how PAYE works", there's no iron law that says it has to be done that way. PAYE was created in a pre-computer age and works very effectively in allowing regular deductions from  weekly or monthly pay by each employer or pension payer, without needing to share any significant amount of personal financial information - just a tax code for each employer, and a lookup in a PAYE table that could be ( and used to always be) done manually.

It also pre-dates the ability to take irregular lump sum income from pensions, which is the way that increasing numbers of retirees will be getting their income. So it will increasingly get more and more of these calculations "wrong" in the first instance if it assumes them to be a monthly income.

If it's possible to do a reclaim process via a quick online claim, it should also be possible to integrate that process into the initial calculation and payment, if the recipient ticks a box that says "this is a one-off payment and not a new monthly income".  At some point, it'll become more cost effective to fix the system to do it right first time rather than paying to process several million regular refunds.

This was what I was trying to highlight (very, very poorly)

The cost saving to HMRC would be enormous (reduced need for refunds).....

The pensions freedoms act was 10 years ago.....
How long will it take HMRC to catch up in this digital age?