Take Nra65 pension delay lump sum

[rkss]

Can one take your Nra65 pension but delay the taxable part or all of lump sum till after you retire?
To avoid paying 40% tax in current financial year.?

[RobertT]

Are you referring to the DBCBS?

All NRA65 benefits must be taken at the same time. Therefore I don't think it's possible to just leave any DBCBS with the RMPP, until a later date.

It might be possible to transfer out any excess to a personal pension instead, after the 25% tax free amount has been taken,
Get in touch with the PSC for clarification.

It is definitely possible to transfer out your total DBCBS pot to a personal pension.
Once in there, you can draw it down over a period of time and depending on your total income, you may even be able to avoid paying tax on some of it altogether.

[rkss]

Hi yes, the Dbcbs.
So can the remaining 75% of this be paid into Scottish widows avc? Then when I want drawdown as I already pay into this.
Thanks

[RobertT]

It's not possible to pay the DBCBS into your AVC.

Nor is it possible to drawdown directly from your AVC. It will need to be transferred to a personal pension first.

[rkss]

Hi ok,
So can you give an example of a personal pension ie with whom, is this something SW can provide?
So all the money I have currently in SW as avc, s will need to be transferred in a personal pension and from there I can withdraw any a mounts I want?
Thanks

[RobertT]

There are lots of pension providers out there, such as Scottish Widows, Aviva, Standard Life, Legal & General, Aegon, Hargreaves Lansdown and AJ Bell, to name a few.

Some PP's are fairly basic with a relatively small choice of investments, and then there's Self Invested Personal Pensions(SIPP's) which have a much bigger choice.

Your AVC's can be used in the same way as the DBCBS - to fund the tax free cash when taking your NRA60/65 pensions, with any excess being paid out as an Uncrystalised Pension Funds Lump Sum(UFPLS). Which basically means the first 25% of that is also tax free.

Or they can be transferred out to a PP for drawdown or to buy an annuity(income for life).

When you drawdown the money in a PP, the first 25% is normally tax free, with the remainder being classed as income and taxed accordingly. So if you were to draw it down over a few years, you may pay less tax than if you take it all out in one go.
But that would obviously depend on the amounts involved and your other income.

More drawdown info here: https://www.moneyhelper.org.uk/en/pensi ... n-drawdown

[rkss]

Thanks for info,
The fees /charges by some of the companies are Hargreaves are pretty high.
Wouldn't be looking or wanting to invest in risky areas as I would be looking to drawdown asap the whole amount but having to keep within 20% tax bracket would still take around 10years.

[NorthernBoy]

Thanks for info,
The fees /charges by some of the companies are Hargreaves are pretty high.
Wouldn't be looking or wanting to invest in risky areas as I would be looking to drawdown asap the whole amount but having to keep within 20% tax bracket would still take around 10years.

The fees for ii sipp are about £13 a month and withdrawals are free I believe, they pay 3.5% interest on cash balances over 10k. I don’t know how this compares to the other companies but seems reasonable to me.

[rkss]

Thanks, that's sound good if they pay interest. Will easily offset charges.
Did not know you can get interest on Sipp. Looks like Bestinvest pays 4.35% will look into this thanks.