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Can I continue to contract out of S2P after taking an annuity and tax free cash

newtronsols
newtronsols Posts: 8 Forumite
in Pensions, annuities & retirement planning
I have taken a cash payment and annuity early. So now what happens to future NI rebates. Can I continue to contract out of S2P.

I have signed to say I won't pay the tax free cash into another pension. So I need to start another pension but only with my S2P rebates.

I was also told that as I was a company director I couldn't contribute to an S2P rebate-based pension.
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Comments

  • dunstonh
    dunstonh Posts: 121,420 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Why would you want to contract out? The last time to contract out is age 45 for men, 40 for women. After that you are virtually guaranteed to be worse off after those ages.

    You can pay into another pension as long as you have the income to support it.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • newtronsols
    newtronsols Posts: 8 Forumite
    Maybe I would be worse off. Who knows.

    But I would like the choice to continue contracted out with the rebate paid into a pension.
  • dunstonh
    dunstonh Posts: 121,420 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Maybe I would be worse off. Who knows.

    There is no maybe about it. 44 is the last increase in the rebate percentage. After 45 the rebate isnt high enough and it virtually rules out any chance of you being better off. This isnt a judgement call where it could be either way. You will be worse off.


    If you do choose to remain contracted out then you will need a new pension for the rebates to go into as the current one has crystallised.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • newtronsols
    newtronsols Posts: 8 Forumite
    Yes in 2023 I will be worse off. Then you can say I told you so.

    But now I have extra cash each month and a tax free sum.

    So I'd like to repeat this in 15 years time by paying my NI rebate into a pension.

    But who can I do this with?
  • EdInvestor
    EdInvestor Posts: 15,749 Forumite
    newtronsols wrote: »
    But who can I do this with?

    Any pension provider with an appropriate plan, ie an insurance company.From October you should be able to use a SIPP as well.
    Trying to keep it simple...;)
  • newtronsols
    newtronsols Posts: 8 Forumite
    I have just been told by a major pension provider that:

    "some companies ..have made a blanket policy of contracting people back in the state scheme".

    His company presumably won't ...and others on an 'execution basis' only.

    But what others?
  • dunstonh
    dunstonh Posts: 121,420 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    The decision to bulk contract in tends to be from those that had a tied salesforce and/or are in low potential growth funds. This is done purely to reduce the liability for complaint later on. Not necessarily for the benefit of the client who may still be better contracting out but not in that particular scheme.

    Most tied salesforces have stopped contracting out because they dont want the liability. Its either DIY or IFA mainly nowadays.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • newtronsols
    newtronsols Posts: 8 Forumite
    Norwich Union Yes or No
    Canada Life Yes or No
    Skandia Life Yes or No

    etc
  • EdInvestor
    EdInvestor Posts: 15,749 Forumite
    Ring them up and ask.
    Trying to keep it simple...;)
  • newtronsols
    newtronsols Posts: 8 Forumite
    From my limited experience so far no one knows very much about s2p, pensions, ni rebates, especially 'after' you've taken an annuity. That's the end of the tracks.

    They say you will have to find someone willing....but not them.
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