Taking first UFPLS from a small Hargreaves Lansdown SIPP

1246

Comments

  • fairleads
    fairleads Posts: 595 Forumite
    edited 29 March 2017 at 8:18PM
    i've just received my first UFPLS interbank payment and within 4 business days after sending my postal application. Excellent service from H&L.
  • Jerben
    Jerben Posts: 69
    First Anniversary First Post Combo Breaker
    Forumite
    Rob,
    If it was a UFPLS and there's still money in the pension pot,.. yes, P55.
    But there can be other situations! The options are at:
    https://www.gov.uk/claim-tax-refund/you-get-a-pension
  • Nationwide8
    Nationwide8 Posts: 362
    Hung up my suit!
    Forumite
    Malthusian wrote: »
    You've only drawn funds out of the SIPP via UFPLS, correct? If so, what remains in the SIPP is uncrystallised funds. Meaning you can take 25% of the uncrystallised £1,000, and 25% of the uncrystallised £3,600, so 25% of £4,600.

    Thank you,in theory this is what I should be doing tax year 17-18.This is all new to me so learning as I go along.
  • Nationwide8
    Nationwide8 Posts: 362
    Hung up my suit!
    Forumite
    digannio wrote: »
    In answer to your earlier question, yes I was taxed even though I am a non-taxpayer. It's all to do with the tax code that's applied to you then being divided up on a monthly basis for tax purposes. Therefore the lump sum I withdrew exceeded the allowance for that month and I was taxed in the figures supplied by HL. I claimed the tax back straight away and it was refunded by HMRC. They said in the letter it was refunded using estimated figures for the year and that I would be contacted again if they owed me or I owed them at the end of the year. Neither was the case as I never exceeded the personal allowance at year end.

    HL will probably be able to explain the above better than me if I've made it all as clear as mud! Anyway, I'm currently moving my SIPP from HL to Fidelity to take advantage of the £100 cashback offer and cheaper charges on the invested side of it.

    Thanks for the above,am still waiting to see if the small withdrawal I requested last week over and above the 25% will be processed in this tax year,if it is I'll have a go at claiming the tax back,it it's processed in tax year 17-18 will wait until nearer end of that tax year.
  • Nationwide8
    Nationwide8 Posts: 362
    Hung up my suit!
    Forumite
    fairleads wrote: »
    i've just received my first UFPLS interbank payment and within 4 business days after sending my postal application. Excellent service from H&L.

    I sent my form off for next day delivery on Tuesday,SIPP still showing no withdrawal today,touch and go if HL will process it Mon or Tues !!
  • bowlhead99
    bowlhead99 Posts: 12,295
    Name Dropper First Post First Anniversary Post of the Month
    Forumite
    edited 1 April 2017 at 6:13PM
    I sent my form off for next day delivery on Tuesday,SIPP still showing no withdrawal today,touch and go if HL will process it Mon or Tues !!
    If it helps, I mentioned above that my mum's application form was sent next day delivery on Saturday so they'll have received it Monday 27th.

    On her online statement the £2600 withdrawal from her account shows as:
    30/3/2017 Payment to Client Bank A/C:xxxxxxx -2393.60
    30/3/2017 UFPLS Tax Payment -206.40

    She has the money in her bank.

    So, if your application is following along two business days behind hers (i.e. they received it Wednesday instead of Monday), you'd perhaps expect the withdrawal to be done next Monday 3rd April and your P60 will reflect it being a 2016/17 income. No doubt they'll be busy this time of year, so no guarantees :)

    --
    *edit - I just noticed you were talking about "the small withdrawal I requested last week over and above the 25%". That implies you are perhaps crystallising your pension, taking an initial 25% of the whole gross amount taxfree, and then just drawing down a small amount of the remaining taxable balance with the intention of taking the remaining taxable balance at some point later?

    Whereas this thread is about UFPLS where you withdraw a chunk from your uncrystallised pension and 25% of that lump is taxfree, 75% taxable, with all the remaining amount still uncrystallised so you can draw further tax free amount in the future. By doing it that way, there's three times as much taxable money as tax-free within your current chunk (e.g. £2600 is £650 taxfree and £1950 taxable with the remainder untouched). Which doesn't sound quite like doing a 'small withdrawal over and above the tax free amount'?

    So I wasn't sure if you were doing the exact same process as described above or just describing it in a funny way due to a slight misunderstanding.
  • Nationwide8
    Nationwide8 Posts: 362
    Hung up my suit!
    Forumite
    edited 3 April 2017 at 8:02PM
    My payment just came through today,full marks to HL :j it's within this tax year.

    bowlhead I know what you are saying in the above post ( I think ) ,I was thinking any amount I'd draw out above £900 ( tax free amount of the 3600 ) would be taxed ie if I drew out £1400...£500 would be taxed.

    Anyway ...these are the figures if someone can explain it because I can't..

    £3600 in the SIPP
    I requested withdrawal of £1400

    3/4/17...paid to my bank £1373.60
    3/4/17...UFPLS tax payment £26.40

    So am assuming i got 25% of £1400 tax free ( £ 350 ) ?? ,that leaves £1050....so how does that translate into just £26.40 tax ??
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458
    Uniform Washer
    Forumite
    edited 3 April 2017 at 7:20PM
    Nationwide8

    You have probably been taxed on the "emergency" tax code but your figures make absolutely no sense whatsoever!

    If you requested withdrawal of £1400 how/why would you get 25% of £1500 tax free?

    Is £1400 withdrawl definitely the correct figure?

    If so the emergency tax code would normally allow approx £917 without tax then 20% tax on the remainder. If you needed to pay basic rate tax on the withdrawl then you need to set aside £183.60 for the shortfall.
  • Nationwide8
    Nationwide8 Posts: 362
    Hung up my suit!
    Forumite
    £1400 is definitely the withdrawal amount I requested out of a SIPP with £3600 in it..

    £1373.60 paid into my bank today..
    £26.40 taken as a UFPLS tax payment..

    Those are the figures :eek:
  • That does look like the emergency tax code has been used on what i presume is a taxable amount of £1050.
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 342.5K Banking & Borrowing
  • 249.9K Reduce Debt & Boost Income
  • 449.4K Spending & Discounts
  • 234.6K Work, Benefits & Business
  • 607.1K Mortgages, Homes & Bills
  • 172.8K Life & Family
  • 247.4K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards