SIPP Withdrawal Amount Options

Secret2ndAccount

If, across several years. I withdraw £100,000 from my pension, I pay £15,000 in tax

If I don't withdraw the money, I pay no tax, and I have £100,000 more in my pension. Clearly option B is better.

What I am missing:

. I could spend that £85,000 on car / extension / holiday / helping others.

. One day, I will withdraw that money, and will still have to pay the tax.

What I should be thinking:

. How much do I need?

. How much can I sustainably withdraw?

The only way to avoid paying tax on the pension is to die before age 75

What you are doing is pushing the pieces around the board. You are not beating the chancellor at chess. Multiple posts have told you; I will repeat:

Withdraw > £12,570 total taxable income every year

Withdraw < £50k total taxable income every year or you will pay extra tax

In between, it doesn't matter when you withdraw. You will pay the tax eventually. To a good approximation, the same amount. Not many thousands different. Maybe a little bit if the rules change. Nobody knows for sure.

They have already moved the tax rate to 22% for savings, rental income, and dividends. Aren't you worried that the money you leave in will later cost you 22% to get out?

Julezy101

https://forums.moneysavingexpert.com/discussion/comment/82170680#Comment_82170680

Thank you @Secret2ndAccount and apologies for my lack of understanding. I was just trying to explore if there was an alternative.