PCLS and Cancellation Rights

valiant24

DRS1 said:

... presumably the SIPP provider never claimed any on the repaid lump sum.

No I wouldn't have thought so.  Until a week or two ago they were telling me that I could retake the lump sum now.

Dead_keen

I guess you got lucky: https://archive.is/nooDL

Grumpy_chap

valiant24 said:

However there would be a world of difference between ii offering advice to an investor on whether the withdrawal, and potential repayment, of PCLS would be an appropriate course of action for a particular investor; and answering correctly "Do I have a 30-day cooling-off period for this transaction?"

I can't see that advice that a transaction has a cooling-off period when it doesn't could be covered by a disclaimer.   It doesn't constiture tax, legal, investment or other financial advice.

I think it is possible for both to be true simultaneously.

Individual - Do I have a 30-day cooling-off period for this transaction?
Fund - Yes.  Nothing in this answer constitutes tax, legal, investment or other financial advice.

So, yes, the fund will allow you to reverse the draw-down.  The fund has not commented on whether there is a tax implication on that course of action.

Given that the OP indicates they have an Accountant, why are they only asking the Accountant to comments on the tax position now a year after the event and not for advise in advance?
If anything, I would suspect that, had the Accountant given erroneous advice prior to the draw-down, then the Accountant's PI cover might have been on the hook (rather than the pension fund).  After all, the advice published in the past day or so is only confirming the rules that were in force a year ago.





EDIT:

Dead_keen said:

I guess you got lucky: https://archive.is/nooDL

Well, the OP could be in the clear.
The article you have linked states "Last week, HMRC confirmed that pensioners who obtained their lump sum after Dec 5 would not be allowed to reinstate it."
The OP appears to have completed their loop prior to that date:

valiant24 said:

Withdrew £410,000 25/1024, returned 14/11/24.

QrizB

I can't find anything from HMRC with that Dec 5 cut-off date, though. That's the publication date of Newsletter 16 but there's nothing in that to suggest that it's the effective date for any HMRC change in treatment.

https://www.gov.uk/government/publications/pensions-schemes-newsletter-165-december-2024/newsletter-165-december-2024

Grumpy_chap

QrizB said:

I can't find anything from HMRC with that Dec 5 cut-off date, though. That's the publication date of Newsletter 16 but there's nothing in that to suggest that it's the effective date for any HMRC change in treatment.

https://www.gov.uk/government/publications/pensions-schemes-newsletter-165-december-2024/newsletter-165-december-2024

One might assume that the quote in The Telegraph article was not made up:

A spokesman for HMRC said: “We made our position on the tax rules around returning tax-free lump sums clear on Dec 5, 2024. We will seek to challenge alternative interpretations of these rules after this date.”

valiant24

Grumpy_chap said:

..... Given that the OP indicates they have an Accountant, why are they only asking the Accountant to comments on the tax position now a year after the event and not for advise in advance?

Because, at the time I did the withdrawal and return (Oct 2024 and Nov 2024 respectively), there was no suggestion that the cooling-off period would not apply; and the SIPP platform assured me that it would.  I may have mentioned my intention to the accountant but he didn't demur.

Only the following month, Dec 2024, did the HMRC issue its opinion that the cooling-off period didn't apply to this type of transaction.  And only on 25th Sep 2025 did the FCA announce that it concurred.  That's why I am having the conversation now.

I also read the article in the Telegraph a day or two ago with a quote purporting to be from HMRC saying that it would seek to challenge such transactions that took place after 5th December 2024.  On the face of it I seem to be in the clear.  But:
1. The quote doesn't explicitly say that it won't challenge transactions prior to that date
2. I have only read this in the Telegraph (and the Express, but that was a re-hash of the Telegraph article).  The Telegraph is not exactly the Financial Journal of Record.   And I would feel very much more comfortable if the same statement was repeated in other media, esp by HMRC themselves.

My SIPP platform is studiously ignoring all my queries and requests.