Final Pension Calculation
HGS
Posts: 19 Forumite
I took a zero drawdown pension with L&G and they miscalculated the figures so without discussion repaid the sum as a drawdown.
I disputed that decision as no facts or figures were included and I was pretty sure it was beneficial to them and not me.
I also asked for inconvenience costs and compensation for my time dealing with their mistake.
I was surprised to receive a cheque for over £100 without any bartering making me think that I was on to something they wanted me to drop promptly.
I asked for facts and figures and whilst I got them, it was clear the figures were totally absurd.
I pointed this out and got an instant admission and apology.
The figures showed they calculated the offer without tax deduction over a life expectancy of 20 years but losing an immediate 20% in tax on the one off payment and my belief 20 years is not at all generous for my possible lifespan I calculated I was losing a minimum of £100 from the drawdown.
The amount is actually irrelevant, but the principal that I decided on no drawdown and they make money ignoring my wishes is not acceptable.
Given their client base this will amount in millions of profit for L&G.
If you are being treated in the same cavalier manner firstly ensure you are happy losing money potentially, and secondly offset it with a request for inconvenience costs.
I have asked for the money to be returned to my pension so principal (and possibly the law) is upheld.
I disputed that decision as no facts or figures were included and I was pretty sure it was beneficial to them and not me.
I also asked for inconvenience costs and compensation for my time dealing with their mistake.
I was surprised to receive a cheque for over £100 without any bartering making me think that I was on to something they wanted me to drop promptly.
I asked for facts and figures and whilst I got them, it was clear the figures were totally absurd.
I pointed this out and got an instant admission and apology.
The figures showed they calculated the offer without tax deduction over a life expectancy of 20 years but losing an immediate 20% in tax on the one off payment and my belief 20 years is not at all generous for my possible lifespan I calculated I was losing a minimum of £100 from the drawdown.
The amount is actually irrelevant, but the principal that I decided on no drawdown and they make money ignoring my wishes is not acceptable.
Given their client base this will amount in millions of profit for L&G.
If you are being treated in the same cavalier manner firstly ensure you are happy losing money potentially, and secondly offset it with a request for inconvenience costs.
I have asked for the money to be returned to my pension so principal (and possibly the law) is upheld.
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Comments
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I took a zero drawdown pension with L&G and they miscalculated the figures so without discussion repaid the sum as a drawdown.
Do you mean that you took a PCLS only and that L&G made an income payment (be exactly sure) without your express request and permission?0 -
Did they notify you that you are now subject to the £4000 a year money purchase annual allowance cap on annual pension contributions? Whether you are depends on the type of payment that they made, some would trigger it, others not..0
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I have no idea what you are asking. If my explanation is confusing then I can’t help.
Clearly I am not wrong as they have offered to do what I want and not what suited them.0 -
Just so I understand ...
You asked for a tax free lump sum from your L&G pension, with no taxable income to be paid?
L&G then paid you a lump sum and mistakenly also paid you some taxable income?
You complained, and they apologised but provided you with no figures, but did include £100 for inconvenience?
You then asked for figures regarding the error and L&G sent you the wrong figures?
After bringing that error to L&G's attention, you then received an accurate breakdown of their calculation, which you feel is not fair and makes you at least £100 worse off?
You are concerned that L&G are doing the same to tens of thousands of their customers and are making £millions in the process?
If the above is correct and you are still unhappy then you should take your complaint to the Financial Ombudsman.
I would strongly suspect that this is a one-off error by L&G, and whilst it's not nice being on the receiving end of it, it's probably a step too far to suggest they are swindling £millions out of their clients in this way.I am an Independent Financial Adviser. Any comments I make here are intended for information / discussion only. Nothing I post here should be construed as advice. If you are looking for individual financial advice, please contact a local Independent Financial Adviser.0 -
If they paid you ordinary taxable drawdown money, like via UFPLS, that would trigger something called the money purchase annual allowance. The MPAA restricts you to 4k a year of pension contributions. If they did this and you might want to pay more then you need to verify with them that they fully reversed it and you're not subject to the MPAA.0
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The figures showed they calculated the offer without tax deduction over a life expectancy of 20 years but losing an immediate 20% in tax on the one off payment and my belief 20 years is not at all generous for my possible lifespan I calculated I was losing a minimum of £100 from the drawdown.
I think we're all struggling to understand your problem, based on the terminology you used.
What sort of pension did you have before you accessed it? Most pensions with insurers are based on a pot of money which has been accumulated. Why did they need to do this calculation involving life expectancy?0 -
Given the situation was reported by Martin Lewis it was obviously not a one off.
I reported it to help others so this sort of guesswork is just pointless and unhelpful supposition.0 -
Sorry you can’t understand but if you were one of the people affected and receiving the same treatment you would not need to be asking.
I am not here to educate, I am here to ensure others affected get a fair deal. If you are not affected my pension arrangements are of no interest and with respect not your business to investigate.
L&G have apologised for their cavalier attitude and misinformation, compensated me and I will now earn more money than they originally paid out.
Total vindication not requiring further comment.
No further posts please.0 -
Sorry you can’t understand but if you were one of the people affected and receiving the same treatment you would not need to be asking.
I am not here to educate, I am here to ensure others affected get a fair deal. If you are not affected my pension arrangements are of no interest and with respect not your business to investigate.
L&G have apologised for their cavalier attitude and misinformation, compensated me and I will now earn more money than they originally paid out.
Total vindication not requiring further comment.
No further posts please.
Well, someone had to...
Glad you're 'not here to educate' OP, as I suspect it's not your forte...0 -
No it’s not my job, but you know everything so nothing would be useful to you.0
This discussion has been closed.
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