Removing TFLS and where to leave residual funds?

RogerPensionGuy

I'm just in the process of removing my remaining TFLS available to me from a SIPP and will then of consumed the full 268ish finally. 

My example is like 600K in SIPP and 100K TFLS still available. 

SIPP provided advised me when I pull out the 100K, then 300K will move in to drawdown and these funds will be crystallised.

They ask do I want the 200K uncrystallised to remain uncrystallised or put in the crystallised drawdown pot. 

They are aware I will of consumed my full 268 TFLS after the 100 is removed. 

They say it's my choice. 

I voiced the only reason leaving some in uncrystallised is if 268 was ever increased, maybe that would be helpful, however if I only hold crystallised funds it may not be helpful. 

So I have currently opted to leave residual in uncrystallised funds. 

Any views comments most welcome please? 

ali_bear

Leave uncrystallised. Maybe the TLFS gets increased. No downside and you will have planned for a potential, even if unexpected, piece of good fortune. 

QrizB

I can't see any harm in leaving £200k uncrystallised. Folk here say it's easier to move uncrystallised funds, and there's no advantage to crystallising if you can't take the TFLS.

squirrelpie

Does it make any difference to how much you pay your provider in charges? Some pounds every month might balance a theoretical future possible pounds benefit.

RogerPensionGuy

squirrelpie said:

Does it make any difference to how much you pay your provider in charges? Some pounds every month might balance a theoretical future possible pounds benefit.

SIPP provider said due to moving from accumulating to deaccumlating phaze their AMC will probably change, any changes to AMC will be shown on documents. They also mentioned any units held % charges won't change. 

I will look forward to reading their paperwork. 

With this SIPP provider I also have a GIA and different charges are applied between the SIPP and GIA for the same units. 

So I expect AMC to increase on the SIPP. 

RogerPensionGuy

QrizB said:

I can't see any harm in leaving £200k uncrystallised. Folk here say it's easier to move uncrystallised funds, and there's no advantage to crystallising if you can't take the TFLS.

Further to this comment. 

This SIPP provider has indeed told me after I remove that TFLS and have the two pots in the SIPP, some being crystallised and some being uncrystallised, if in the future if I wish to transfer to another SIPP provider, some providers won't accept crystallised funds. 

DRS1

RogerPensionGuy said:

squirrelpie said:

Does it make any difference to how much you pay your provider in charges? Some pounds every month might balance a theoretical future possible pounds benefit.

SIPP provider said due to moving from accumulating to deaccumlating phaze their AMC will probably change, any changes to AMC will be shown on documents. They also mentioned any units held % charges won't change. 

I will look forward to reading their paperwork. 

With this SIPP provider I also have a GIA and different charges are applied between the SIPP and GIA for the same units. 

So I expect AMC to increase on the SIPP. 

I thought AMC was a charge levied by the investment manager and was internal to the investment fund you are invested in. I think @squirrelpie was thinking of providers like HL who charge two sets of platform fees where you have both crystallised and uncrystallised pots (which can but doesn't always result in higher aggregate charges).

But maybe your provider uses AMC to mean platform fees?

FIREDreamer

RogerPensionGuy said:

QrizB said:

I can't see any harm in leaving £200k uncrystallised. Folk here say it's easier to move uncrystallised funds, and there's no advantage to crystallising if you can't take the TFLS.

Further to this comment. 

This SIPP provider has indeed told me after I remove that TFLS and have the two pots in the SIPP, some being crystallised and some being uncrystallised, if in the future if I wish to transfer to another SIPP provider, some providers won't accept crystallised funds. 

Crystallised funds can only be transferred in their entirety. The only exception is a partial transfer / payment can be made to purchase an annuity.

Been there, done that, got the t-shirt. 😀

RogerPensionGuy

DRS1 said:

RogerPensionGuy said:

squirrelpie said:

Does it make any difference to how much you pay your provider in charges? Some pounds every month might balance a theoretical future possible pounds benefit.

SIPP provider said due to moving from accumulating to deaccumlating phaze their AMC will probably change, any changes to AMC will be shown on documents. They also mentioned any units held % charges won't change. 

I will look forward to reading their paperwork. 

With this SIPP provider I also have a GIA and different charges are applied between the SIPP and GIA for the same units. 

So I expect AMC to increase on the SIPP. 

I thought AMC was a charge levied by the investment manager and was internal to the investment fund you are invested in. I think @squirrelpie was thinking of providers like HL who charge two sets of platform fees where you have both crystallised and uncrystallised pots (which can but doesn't always result in higher aggregate charges).

But maybe your provider uses AMC to mean platform fees?

I just review charges. 

AMC (annual management fee) is used to show a platform fee/cost per annum. 

AC (annual charge) is used to show fee/cost of any difference units held.

For information I have the same units in the SIPP & GIA within the same platform and they apply different AC to these units, just like much stuff, information can be very opak to view & understand in these matters. 

Ciprico

If part of the SIPP is left uncrystalised you can

 -add £2800/3600 pa

- take three small pots from it, so increase the tfls by £30k

You can't take small pots from crystalised acct

As you say you will have taken £268k-ish, the second reason could be worth some consideration.....

Albermarle

DRS1 said:

RogerPensionGuy said:

squirrelpie said:

Does it make any difference to how much you pay your provider in charges? Some pounds every month might balance a theoretical future possible pounds benefit.

SIPP provider said due to moving from accumulating to deaccumlating phaze their AMC will probably change, any changes to AMC will be shown on documents. They also mentioned any units held % charges won't change. 

I will look forward to reading their paperwork. 

With this SIPP provider I also have a GIA and different charges are applied between the SIPP and GIA for the same units. 

So I expect AMC to increase on the SIPP. 

I thought AMC was a charge levied by the investment manager and was internal to the investment fund you are invested in. I think @squirrelpie was thinking of providers like HL who charge two sets of platform fees where you have both crystallised and uncrystallised pots (which can but doesn't always result in higher aggregate charges).

But maybe your provider uses AMC to mean platform fees?

I have a pension with Scottish Widows ( ex workplace) . The platform/management fee is fixed, but the investment fund charges are higher if you start drawdown. It is not a lot and overall charges are very low anyway. I have never looked into the actual mechanics of how it would work as I will probably never actually drawdown from that pot as SW comms and service are poor, but the charges are very cheap in this case .