Crystallised v Uncrystallised pension

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81960114#Comment_81960114

How the starting rate for savings works - Money Saving Expert

Sarahspangles

https://forums.moneysavingexpert.com/discussion/comment/81960114#Comment_81960114

If your non-savings income is below the personal allowance (currently £12,570) you automatically get up to £5,000 starter rate for savings. That’s a simplification, so if you have dividend income or more complicated allowances, it would be better to read something like the link below.

On 6 April (first day of the tax year) I logged in to HMRC and updated that my pension income would be £12,570. By the following morning my tax code had been amended to 1257L, even though last year I had well over £1,000 in bank interest ie nothing will be deducted from my pension through PAYE, which is normally how HMRC recover tax on untaxed savings. You don’t even have to update HMRC, although if I hadn’t I would have paid some tax and might not have got this refunded until autumn next year.

Yes, next year I won’t be able to use the starter savings allowance as my pensions will be higher.

https://www.litrg.org.uk/savings-property/tax-savings-and-investments/tax-savings-income/starting-rate-savings