Soon to retire

kendricks1

Hi, recently moved my sipp into a safer deposit account as it was in a high risk plan ,as planning on retiring soon,also have a small nhs pension and some cash savings,whats a general tax efficient way of withdrawing from any of the three above.

I was thinking of taking the 12750 a year from sipp and a futher 5000 from the intrest from cash one year bonds,taking the lump sum from the nhs but leaving the nhs pension itself till I dont take a hit from early retirement clause.

Any ideas on the best idea to withdraw without paying tax thanks.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6661728/soon-to-retire

Presumably you mean £12,570, not £12,750.

What you take out of savings isn't really a factor as far as tax is concerned. It's the interest you earn which is important.

And if you mean one of the normal NHS schemes I think you'll find any PCLS is literally that, something that has to be taken when the pension commences. Not in advance of the pension commencing.

Marcon

I was thinking of taking the 12750 a year from sipp and a futher 5000 from the intrest from cash one year bonds,taking the lump sum from the nhs but leaving the nhs pension itself till I dont take a hit from early retirement clause.

You can't take a lump sum from a defined benefit scheme (and that's what the NHS scheme is) without the pension coming into payment. If you take a DB pension early, it is usually reduced to reflect the fact that it is being paid sooner than expected and will therefore be payable for more years than if you'd taken it as the scheme's normal retirement age.

What sort of bonds have you got?

MallyGirl

why wouldn't you take enough to utilise the personal allowance?

Albermarle

Hi, recently moved my sipp into a safer deposit account as it was in a high risk plan ,as planning on retiring soon

If you intend to completely withdraw this SIPP over the next few years, then this was probably a sensible move. However if you intend to withdraw from it for many years, it is better than at least part of it stays invested,

kendricks1

https://forums.moneysavingexpert.com/discussion/comment/81941440#Comment_81941440

https://forums.moneysavingexpert.com/discussion/comment/81941450#Comment_81941450

https://forums.moneysavingexpert.com/discussion/comment/81941450#Comment_81941450

I thought taking the 12750 from the sipp was taking my full allowance

kendricks1

Thank you for clearing that up on the nhs pension, I've literally just started to read up on these matters,I hold a few one year deposit accounts giving around 4.25 % .

kendricks1

Hi,sorry I meant the intrest from the savings,and I now understand i need to draw of the nhs pension to take the lump sum cheers.

huw01

The personal allowance is 12570 not 12750. You misquote the amount twice in this thread

af1963

Along with the taxable 12570 that you take from the SIPP, you can also take the associated tax free cash (assuming you haven't already taken the tax free cash separately). 25% of the total that you withdraw can be TFC, which means you can take 16760 in total. Plus separately, whatever you earn in interest, up to the £5k maximum.

kendricks1

https://forums.moneysavingexpert.com/discussion/comment/81941892#Comment_81941892

Sorry hold my head in shame 🤣