Transfering then drawing a pension at age 55

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  • ProDave
    ProDave Posts: 3,721 Forumite
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    NorthernGeezer wrote: »
    If you're a non-taxpayer or only withdraw a sum less than your allowance then you gain the full amount
    Do they srill deduct tax at source if that is the case and you have to claim it back via your tax return? or will they pay gross and it's up to you to declare it on your tax return?
  • Audaxer
    Audaxer Posts: 3,508 Forumite
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    ProDave wrote: »
    Do they srill deduct tax at source if that is the case and you have to claim it back via your tax return? or will they pay gross and it's up to you to declare it on your tax return?
    I believe they do take the tax at source and if you are under the tax limit you can claim it back, but I think you can probably do that online as a one-off rather than having to start completing a tax return if you don't already need to complete one.

    I may be stating the obvious but do you realise that once your Aviva pension is transferred to HL, you will then have to decide where best to invest the £30k or the part thereof you do not intend to drawdown immediately. That is a whole new set of decisions as to what level of risk you want to take and what funds you want to invest in.
  • NorthernGeezer_2
    NorthernGeezer_2 Posts: 153 Forumite
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    I believe they do take the tax at source and if you are under the tax limit you can claim it back, but I think you can probably do that online as a one-off rather than having to start completing a tax return if you don't already need to complete one.
    I believe Audaxer is correct, tax is collected and you claim it back online.
    My understanding from other posts is that this is a 1 off until HMRC issue you with a tax code.
  • ProDave
    ProDave Posts: 3,721 Forumite
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    NorthernGeezer wrote: »
    I believe they do take the tax at source and if you are under the tax limit you can claim it back, but I think you can probably do that online as a one-off rather than having to start completing a tax return if you don't already need to complete one.
    I believe Audaxer is correct, tax is collected and you claim it back online.
    My understanding from other posts is that this is a 1 off until HMRC issue you with a tax code.

    I am self employed so I fill in a tax return every year.

    I do have another pension that I am drawing and have been since age 50. With that they issued a tax code and pay me gross. I then enter the amount I have received in the appropriate box on the tax return.
  • xylophone
    xylophone Posts: 44,412 Forumite
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    My understanding from other posts is that this is a 1 off until HMRC issue you with a tax code.

    Even if they have a tax code and you make a one off withdrawal, tax is deducted and you either have to claim it back or await HMRC repayment after the end of the tax year.
  • NorthernGeezer_2
    NorthernGeezer_2 Posts: 153 Forumite
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    So is it best to make your withdrawal in March of the tax year or May?
  • ProDave
    ProDave Posts: 3,721 Forumite
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    Just bumping this thread.

    I am happy to report the transfer from FL/Aviva to my HL SIPP has completed and it's now showing in my SIPP. I lost £5 of value in the transfer so I can live with that.

    So now I can proceed with the drawdown plan as I wish.
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