Nest triggered MPAA on a pot less than £10,000

Albermarle

DRS1 said:

OK More than the one box to tick.

Also after you get the payment, you get more paperwork, including a P45 !

DavidT67

FIREDreamer said:

 

Hargreaves have a specific form to fill in for a small pot of £10,000 or less.

Thanks, can you post the URL to download the form ?

ali_bear

If you telephone them they will send it you. 

Albermarle

ali_bear said:

If you telephone them they will send it you. 

Or you can message them. As well as the form they are obliged to send you all the info about withdrawing from pensions, recommendation to speak to PensionWise etc.

FIREDreamer

DavidT67 said:

FIREDreamer said:

Hargreaves have a specific form to fill in for a small pot of £10,000 or less.

Thanks, can you post the URL to download the form ?

Here it is …

https://www.hl.co.uk/__data/assets/pdf_file/0010/19864405/split-small-pots.pdf

gettoo27

DRS1 said:

GrumpyDil said:

Not sure that helps at all. The point is that if this payment had been taken as a small pot it doesn't trigger the MPAA.

Except it makes the point that YOU have to ask the provider to apply the small pot rules.  You can't just assume that they will do so because the pot is under £10k.

To be fair you'd have thought if she didn't specify it that they would have asked her if she wanted to.

We have asked for all documentation at the time of requesting the full pot withdrawal to be sent. You cannot log into your account with Nest (once closed) to see what was requested and what was sent. One issue would be that my wife would not have known that withdrawal had to be requested under the small pot rules and I doubt many people would know that. It was assumed that NEST would not trigger the MPAA as the letters closing the account are extremely ambiguous and confusing "taking a retirement pot of more than £10,000 is classed as 'flexibly accessing' pension savings on the date the payment is made.
As this was way less than £10k then it would be fair to assume the MPAA had not been triggered. 
On the reverse of the document is a generic statement saying - 'Having flexibly accessed your pot.....' There was nothing flexible here, it was a full withdrawal of the entire pot of less than £5k and the account closed.
They did not inform my wife they were triggering or had triggered the MPAA at any point during the process.

Albermarle

gettoo27 said:

DRS1 said:

GrumpyDil said:

Not sure that helps at all. The point is that if this payment had been taken as a small pot it doesn't trigger the MPAA.

Except it makes the point that YOU have to ask the provider to apply the small pot rules.  You can't just assume that they will do so because the pot is under £10k.

To be fair you'd have thought if she didn't specify it that they would have asked her if she wanted to.

We have asked for all documentation at the time of requesting the full pot withdrawal to be sent. You cannot log into your account with Nest (once closed) to see what was requested and what was sent. One issue would be that my wife would not have known that withdrawal had to be requested under the small pot rules and I doubt many people would know that. That is fair comment as I imagine that 95% of the population have never even heard of this rather niche 'small pot rule' never mind know how to request one. It was assumed that NEST would not trigger the MPAA as the letters closing the account are extremely ambiguous and confusing "taking a retirement pot of more than £10,000 is classed as 'flexibly accessing' pension savings on the date the payment is made. Which would give the impression that taking less than £10K does not.
As this was way less than £10k then it would be fair to assume the MPAA had not been triggered. 
On the reverse of the document is a generic statement saying - 'Having flexibly accessed your pot.....' There was nothing flexible here, it was a full withdrawal of the entire pot of less than £5k and the account closed.
They did not inform my wife they were triggering or had triggered the MPAA at any point during the process.

I think you have a case for the transaction to be reversed, and then done properly .
Whether you can force them to do it is another matter.

dunstonh

One issue would be that my wife would not have known that withdrawal had to be requested under the small pot rules and I doubt many people would know that.

It was assumed that NEST would not trigger the MPAA as the letters closing the account are extremely ambiguous and confusing "taking a retirement pot of more than £10,000 is classed as 'flexibly accessing' pension savings on the date the payment is made.

Nest cannot assume that the small pots rule is available for your wife to use.   It may not have been available.

This is why they say the following in their guide:
You may not be subject to this annual limit if your Nest pot is under £10,000 and you take it all in one go. For more information on tax and pension contributions, visit moneyhelper.org. uk/en/pensions-and-retirement/ tax-and-pensions

On the reverse of the document is a generic statement saying - 'Having flexibly accessed your pot.....' There was nothing flexible here, it was a full withdrawal of the entire pot of less than £5k and the account closed.

Which would be classed as a flexible withdrawal if the small pots option was not requested.      Again, if your wife was not eligible for a small pots withdrawal, then even pennies would trigger the MPAA.

They did not inform my wife they were triggering or had triggered the MPAA at any point during the process.

Yet the guide they give says:

Once you’ve taken any money from your Nest pension or any other pension, then you usually won’t be able to pay more than £10,000 per tax year into any pension savings without paying extra tax. This may reduce your ability to save enough for your retirement. 

Best you can do at this stage is ask for the transaction to be reversed and redone as a small pots withdrawal.

Marcon

gettoo27 said:

DRS1 said:

GrumpyDil said:

Not sure that helps at all. The point is that if this payment had been taken as a small pot it doesn't trigger the MPAA.

Except it makes the point that YOU have to ask the provider to apply the small pot rules.  You can't just assume that they will do so because the pot is under £10k.

To be fair you'd have thought if she didn't specify it that they would have asked her if she wanted to.

We have asked for all documentation at the time of requesting the full pot withdrawal to be sent. You cannot log into your account with Nest (once closed) to see what was requested and what was sent. One issue would be that my wife would not have known that withdrawal had to be requested under the small pot rules and I doubt many people would know that. It was assumed that NEST would not trigger the MPAA as the letters closing the account are extremely ambiguous and confusing "taking a retirement pot of more than £10,000 is classed as 'flexibly accessing' pension savings on the date the payment is made.
As this was way less than £10k then it would be fair to assume the MPAA had not been triggered. 
On the reverse of the document is a generic statement saying - 'Having flexibly accessed your pot.....' There was nothing flexible here, it was a full withdrawal of the entire pot of less than £5k and the account closed.
They did not inform my wife they were triggering or had triggered the MPAA at any point during the process.

Your post makes assumptions (dangerous things where pensions are concerned), indicating your wife failed to read the relevant documentation before requesting the withdrawal. NEST didn't trigger the MPAA; she did.

As others have suggested, she needs to contact them and see if it's possible to reverse the withdrawal (unlikely but worth a go).

ClashCityRocker1

I would be cross that NEST didn't explicitly check whether you wanted it treated as a small pot or not. 

They might want to undo it rather than you raise it as a concern that they didn't. Perhaps to the pensions Ombudsman?