MPAA

Ewan_Kerr

My wife retired from the NHS a couple of years ago and currently draws a pension.

She also has a with profits pension with Royal London, after a brief spell away from the NHS, which hasn't been touched yet and no contributions have been made since 1990. It's currently worth £33000. 

She'd like to withdraw that money, half this year and half next year, before she starts getting her state pension.

To do so she has to transfer the money to a drawdown account, and to enable that she has to fill out a form.

One of the questions on the form asks if she's triggered the MPAA.

To my mind, as she's just taking the money and not paying into a pension, the answer should be no. Is this correct?

Thanks.

Dazed_and_C0nfused

Ewan_Kerr said:

My wife retired from the NHS a couple of years ago and currently draws a pension.

She also has a with profits pension with Royal London, after a brief spell away from the NHS, which hasn't been touched yet and no contributions have been made since 1990. It's currently worth £33000. 

She'd like to withdraw that money, half this year and half next year, before she starts getting her state pension.

To do so she has to transfer the money to a drawdown account, and to enable that she has to fill out a form.

One of the questions on the form asks if she's triggered the MPAA.

To my mind, as she's just taking the money and not paying into a pension, the answer should be no. Is this correct?

Thanks.

If she has only taken her NHS pension and that is one of the standard DB (defined benefit) NHS pensions then she won't have triggered MPAA yet as that only relates to DC (defined contribution) schemes.

xylophone

My wife retired from the NHS a couple of years ago and currently draws a pension.


She also has a with profits pension with Royal London, after a brief spell away from the NHS, which hasn't been touched yet and no contributions have been made since 1990. It's currently worth £33000. 

Her only pensions are her NHS pension and the RL pension.

She is drawing her pension from the NHS Defined Benefit Pension Scheme?

This does not trigger MPAA.

She has not accessed the RL Defined Contribution pension at all yet so has not triggered the MPAA.

Once she draws more than the tax free 25% PCLS from the  RL DC pension, she triggers the MPAA.

SEE

https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/money-purchase-annual-allowance-mpaa

https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-wise/pension-pot-options

Pension Wise appointment covered in above.