Pension recycling query

FoxyLoxy007

Retiring in January, taking the TFLS. If I stick 2880 back into my SIPP from this tax free cash, is that recycling? How can it be proved ?

westv

No it isn't.

Sam_666

As above, not recyclyng. Do a search on this forum and visit hmrc website.

af1963

Why specifically £2880 ?

If you're retiring in January, you'll probably have earnings and pension contributions for this tax year already, so it's unlikely that your allowed extra pension contributions will be exactly £3600 gross.

As to recycling, rules here ...
https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm133810

and a useful flowchart guide here...
https://adviser.royallondon.com/technical-central/pensions/contributions-and-tax-relief/recycling-of-tax-free-cash/

FoxyLoxy007

Sorry, I should have added that I haven’t worked for a year and so received no income or made any pension contributions. 

The plan in January is to take the full tax free amount, and 12570 before April. No other income. The rest of the pension will remain invested for the next couple of years before I take a regular income.

molerat

You do realise you will need to be clever over taking the taxable amount if you want to not pay any / too much tax on it and having to reclaim ?

FoxyLoxy007

molerat said:

You do realise you will need to be clever over taking the taxable amount if you want to not pay any / too much tax on it and having to reclaim ?

Yep, taking a small amount first to get the non-emergency tax code 👍

DRS1

and drawing at least some of it late in the tax year (March probably best).