On Taking the Max Capped TFLS

jim8888

I'm trying to take an UFPLS sum out of one of my SIPPS at the moment and it's a frustrating process because I'm nearing the max capped limit on the tax free lump sum. It turns out that when you have taken over 90% of the max £268,275 you have to submit paperwork detailing the exact amounts you've taken to date. This has meant I've had to call three providers to confirm the amounts, which turned out to be different than the records I'd kept of what I'd taken, probably due to the difference on when the actual trades were made. I have to say that trying to find the trading documents on Fidelity, Ii and Standard Life websites wasn't easy, and I ended up calling them for confirmation. They too found the information difficult to confirm and asked if they could check and come back to me? So, the learning for me is that when I made those withdrawals I should have saved the relevant documents at the time. I like to think that I have been quite good at keeping such records, but the actual evidence has shown otherwise! (I also thought that I could always easily find the relevant documents on the providers websites, which has not been the case either!)

Exodi

I've never drawndown from a pension, so don't have any real-world experience, but assumed that it would just be based on what you're withdrawing?

AFAIK you can't "sell and withdraw" investments in a single process, so presumably if you sell some investments, the proceeds would be added to your cash balance and then you decide how much you withdraw.

In that sense, it's unimportant what the investments are priced at at the moment you sell, but simply how much you withdraw from cash. This should be fairly easy to track from transaction history.

I appreciate some people will keep no cash on account, and only sell when they need to withdraw, so in that sense the price they sell at could be an exact indicator of how much they withdrew, but it doesn't feel like the best way, considering there's no guarantees I withdrew all (or any!) of what I sold an investment for.

Sorry if I've misunderstood anything, as I said, I don't have any personal experience!

dunstonh

So, the learning for me is that when I made those withdrawals I should have saved the relevant documents at the time. I like to think that I have been quite good at keeping such records, but the actual evidence has shown otherwise

On the old LTA letters, they did tell you to retain the details too.

DavidT67

jim8888 said:

I'm trying to take an UFPLS sum out of one of my SIPPS at the moment and it's a frustrating process because I'm nearing the max capped limit on the tax free lump sum. It turns out that when you have taken over 90% of the max £268,275 you have to submit paperwork detailing the exact amounts you've taken to date. This has meant I've had to call three providers to confirm the amounts, which turned out to be different than the records I'd kept of what I'd taken, probably due to the difference on when the actual trades were made. I have to say that trying to find the trading documents on Fidelity, Ii and Standard Life websites wasn't easy, and I ended up calling them for confirmation. They too found the information difficult to confirm and asked if they could check and come back to me? So, the learning for me is that when I made those withdrawals I should have saved the relevant documents at the time. I like to think that I have been quite good at keeping such records, but the actual evidence has shown otherwise! (I also thought that I could always easily find the relevant documents on the providers websites, which has not been the case either!)

Drawdown payments come from your cash balance, so you don't need trade details.  

All three of our pension providers both DB and DC have all PCLS, FAD & UFPLS documents stored online and in their secure messaging systems, and they posted paper copies to us also, which we retained and filed and recorded on a spreadsheet we used to track LSA, LSBA and LTA allowance remaining.  

So very easy to locate, scan and provide the TFLS history to last provider when we took our final TFLS amount.  Just needed their form to have more than three rows in each section ! ; as from one pot we took seven FAD payments over the years.

Albermarle

Exodi said:

I've never drawndown from a pension, so don't have any real-world experience, but assumed that it would just be based on what you're withdrawing?

AFAIK you can't "sell and withdraw" investments in a single process, so presumably if you sell some investments, the proceeds would be added to your cash balance and then you decide how much you withdraw.

In that sense, it's unimportant what the investments are priced at at the moment you sell, but simply how much you withdraw from cash. This should be fairly easy to track from transaction history.

I appreciate some people will keep no cash on account, and only sell when they need to withdraw, so in that sense the price they sell at could be an exact indicator of how much they withdrew, but it doesn't feel like the best way, considering there's no guarantees I withdrew all (or any!) of what I sold an investment for.

Sorry if I've misunderstood anything, as I said, I don't have any personal experience!

It is possible to withdraw without you personally cashing out investments. You just request the cash, and the provider cashes in investments for you. I think if you have a pension with a traditional insurer, they usually do not have a cash account and this is the only way to do it.
In this case if you were taking the max 25% TFLS, then the actual withdrawal amount could be a bit different from what was 25% at the time of making the request.

ll three of our pension providers both DB and DC have all PCLS, FAD & UFPLS documents stored online and in their secure messaging systems,

The OP mentioned problems with getting the info from Fidelity, which I was a bit surprised about as I can also clearly see all documents on line.
Maybe though if it was many years ago, records would be different.