Retirement Tax Code

trevjl

Sorry if this is a common question but I can't find anything.
I retired last September and claimed and received a refund of my PAYE. 
I have not had anything since, ie I did not receive a tax code for this year, is that normal ?
I am not taking any pension or have any income, but will take my tax free allowance from my DC pension in March. Will that be taxed and have to reclaim or as it is March will I receive it tax free ?

Dazed_and_C0nfused

trevjl said:

Sorry if this is a common question but I can't find anything.
I retired last September and claimed and received a refund of my PAYE. 
I have not had anything since, ie I did not receive a tax code for this year, is that normal ?
I am not taking any pension or have any income, but will take my tax free allowance from my DC pension in March. Will that be taxed and have to reclaim or as it is March will I receive it tax free ?

What would you expect this tax code to show if you have no earnings or pension income 🤔

trevjl

I have no idea hence the question. I have always been PAYE so know little about tax. I was assuming that I would still have a tax code as I am still entitled to a tax free allowance. I am now guessing that they will issue one once I take the tax free allowance from my DC next March, but how am I supposed to know how much I can take if I have no tax code ?

molerat

A tax code and a tax allowance are two entirely different things, a code is purely a method of trying to deduct the correct amount of tax from an income source.  As you have no income sources you have nothing to set a code against.  Taking a one off payment from a DC pension in March will likely result in too much tax being taken with no opportunity to reclaim before the end of the year having to wait for it to filter through normal channels.  It would be better to take a small amount of around £1K earlier in the year and wait for a code to be allocated before taking the big amount in March.

trevjl

Thanks, that makes sense, I didnt know how it works. I will do exactly that.