Applying for early payment of benefits -Update 2

ttsdriver · Post by **ttsdriver** » 11 Jul 2020, 09:01

Hi All,

As promised;

Applied for my estimate for early deferred section C benefits payment in September on 6th June.

Almost exactly one month later my information pack and estimate has arrived.

I left the business in 2012 after 22 years service, mostly PHG or HGV driver on nights.

The estimated figures in my previous post were pretty close to the actual estimate received.
Taking the max lump sum including my small 4k AVC pot will provide me with a lump sum of just under 42k and a reduced annual pension of £6300. This includes
a pension supplement of £720 paid annually until 2032.

So far my experience with Capita has been very positive, hopefully this will continue and payment of my benefits will be on time in September,

Thanks to Robert T and other members for their help and guidance.

Good luck people and happy retirements!!

Post by **stephen500** » 11 Jul 2020, 15:27

ttsdriver wrote:Hi All,

As promised;

Applied for my estimate for early deferred section C benefits payment in September on 6th June.

Almost exactly one month later my information pack and estimate has arrived.

I left the business in 2012 after 22 years service, mostly PHG or HGV driver on nights.

The estimated figures in my previous post were pretty close to the actual estimate received.
Taking the max lump sum including my small 4k AVC pot will provide me with a lump sum of just under 42k and a reduced annual pension of £6300. This includes
a pension supplement of £720 paid annually until 2032.

So far my experience with Capita has been very positive, hopefully this will continue and payment of my benefits will be on time in September,

Thanks to Robert T and other members for their help and guidance.

Good luck people and happy retirements!!

Sounds good. Let us know how you get on. So far I am on track for Nov 1st.

Post by **NorthernBoy** » 11 Jul 2020, 16:54

Sounds like a quick response from them, good to hear.

How much annual pension did you have to give up for the 38k lump sum?

Thanks and best wishes for the future.

ttsdriver · Post by **ttsdriver** » 11 Jul 2020, 21:09

I am giving up approx £1600 per year for the lump sum.

Post by **NorthernBoy** » 11 Jul 2020, 21:56

ttsdriver wrote:I am giving up approx £1600 per year for the lump sum.

Thanks. Not a bad conversion rate at nearly £1 to £24 lump sump.

Post by **freespeech** » 13 Jul 2020, 09:00

NorthernBoy wrote:
ttsdriver wrote:I am giving up approx £1600 per year for the lump sum.

Thanks. Not a bad conversion rate at nearly £1 to £24 lump sump.

If I take max lump sum at 56 from both NRA60 and NRA65 pots my reduction in pension would take 20 years to be worse off than max pension with no lump sum. A risk worth taking especially as the state pension kicks in after 11 years.

Post by **stephen500** » 13 Jul 2020, 09:32

freespeech wrote:
NorthernBoy wrote:
ttsdriver wrote:I am giving up approx £1600 per year for the lump sum.

Thanks. Not a bad conversion rate at nearly £1 to £24 lump sump.
If I take max lump sum at 56 from both NRA60 and NRA65 pots my reduction in pension would take 20 years to be worse off than max pension with no lump sum. A risk worth taking especially as the state pension kicks in after 11 years.

For those who are in RMSPS and RMPP (with DBCBS attached) will find that they may end up with no reduction in the yearly RMPP pension to take their max lump sum and that the DBCBS is used to offset the normal decrease in yearly pension, whilst raising the min LS to possibly the max LS and they may even have some over, known as "excess DBCBS" which is taxed at their normal tax rate.
This should apply to those who are in the DBCBS and in RMPP.

Post by **Steve_claret** » 13 Jul 2020, 15:49

stephen500 wrote: For those who are in RMSPS and RMPP (with DBCBS attached) will find that they may end up with no reduction in the yearly RMPP pension to take their max lump sum and that the DBCBS is used to offset the normal decrease in yearly pension, whilst raising the min LS to possibly the max LS and they may even have some over, known as "excess DBCBS" which is taxed at their normal tax rate. This should apply to those who are in the DBCBS and in RMPP.

That's exactly the scenario which I am planning on when taking my section B NRA65 pension in 5 years time. Hopefully a max 25% tax free Lump Sum and no reduction in annual pension by using the cash balance fund which is still building up month by month. If you also have AVC's as well then paying some tax may be inevitable unfortunately unless you chose to re-invest this money elsewhere.

Post by **stephen500** » 14 Jul 2020, 08:45

Steve_claret wrote:
stephen500 wrote: For those who are in RMSPS and RMPP (with DBCBS attached) will find that they may end up with no reduction in the yearly RMPP pension to take their max lump sum and that the DBCBS is used to offset the normal decrease in yearly pension, whilst raising the min LS to possibly the max LS and they may even have some over, known as "excess DBCBS" which is taxed at their normal tax rate. This should apply to those who are in the DBCBS and in RMPP.
That's exactly the scenario which I am planning on when taking my section B NRA65 pension in 5 years time. Hopefully a max 25% tax free Lump Sum and no reduction in annual pension by using the cash balance fund which is still building up month by month. If you also have AVC's as well then paying some tax may be inevitable unfortunately unless you chose to re-invest this money elsewhere.

I think I will pay about £1200 tax on my excess DBCBS monies. Waiting for that quote.