Transferring out funds from DBCBS?

[datasaint]

Given that the cash balance scheme is now closed, I'm thinking of transferring the funds to my SIPP. Are there any cons I should be aware of?

Is it possible the money in the pension surplus will be awarded back to members? A requirement being you still have to have money in the scheme?

[RobertT]

If your DBCBS pot is worth more than £30k, you'll need IFA approval for any transfer.

Most IFA's aren't even qualified to perform such transfers, a majority of those that are won't be interested in anything under £100k(if not more) and if you do manage to find someone willing, they'll charge at least £4-5k and some could even be double that.

So prepare yourself for a hard time finding one that fits the bill!

If it's less than £30k, there shouldn't really be too many problems.

The RMPP surplus should definitely be paid back to members in my opinion, but whether any of it will be remains to be seen.
My understanding is most of it relates to the pension element(2012-2018) rather than the DBCBS(2018-2024).

[July 1981]

I tried last year, I had just under 60k, I had a appointment with a local company who specialises in DB pensions, the minimum they charged was 7k and they said it would be unethical to perform a transfer, I tried unbiased financial advisors who I believe have over twenty thousand members and had no interest, in the end I used my cash balance towards my lump sum and commuted my lump sum from my pension into my monthly pension, taking the hit on remaining cash balance, this seems pretty unfair to me.

[Trumanity]

If your DBCBS pot is worth more than £30k, you'll need IFA approval for any transfer.

Most IFA's aren't even qualified to perform such transfers, a majority of those that are won't be interested in anything under £100k(if not more) and if you do manage to find someone willing, they'll charge at least £4-5k and some could even be double that.

So prepare yourself for a hard time finding one that fits the bill!

If it's less than £30k, there shouldn't really be too many problems.

The RMPP surplus should definitely be paid back to members in my opinion, but whether any of it will be remains to be seen.
My understanding is most of it relates to the pension element(2012-2018) rather than the DBCBS(2018-2024).

It's a very strait forward paper process if it's under 30K. Transferred out earlier this year.

[Trumanity]

If your DBCBS pot is worth more than £30k, you'll need IFA approval for any transfer.

Most IFA's aren't even qualified to perform such transfers, a majority of those that are won't be interested in anything under £100k(if not more) and if you do manage to find someone willing, they'll charge at least £4-5k and some could even be double that.

So prepare yourself for a hard time finding one that fits the bill!

If it's less than £30k, there shouldn't really be too many problems.

The RMPP surplus should definitely be paid back to members in my opinion, but whether any of it will be remains to be seen.
My understanding is most of it relates to the pension element(2012-2018) rather than the DBCBS(2018-2024).

It's a very strait forward paper process if it's under 30K. Transferred out earlier this year.

straight forward , that is

[Hyrrokkin]

If your DBCBS pot is worth more than £30k, you'll need IFA approval for any transfer.

Most IFA's aren't even qualified to perform such transfers, a majority of those that are won't be interested in anything under £100k(if not more) and if you do manage to find someone willing, they'll charge at least £4-5k and some could even be double that.

So prepare yourself for a hard time finding one that fits the bill!

If it's less than £30k, there shouldn't really be too many problems.

The RMPP surplus should definitely be paid back to members in my opinion, but whether any of it will be remains to be seen.
My understanding is most of it relates to the pension element(2012-2018) rather than the DBCBS(2018-2024).

It's a very strait forward paper process if it's under 30K. Transferred out earlier this year.

Unfortunately i think many of us have over £30k in the DBCBS - not worth the hassle and cost i think and happy enough to leave as is until the time comes (although i would prefer to transfer to my SIPP if that rule was not in place).

As for the pension surplus prepare to be robbed of our money as RM owners want to get their greedy fingers on your money (they want half as i understand the plans)

[Steve_claret]

I took my DBCBS earlier this year when I took my 65 pension. It was approx. £45k in total so I used £17k of this for my RMPP lump sum so I could get a higher annual pension. The excess cash balance then became a UFPLS of which I took another 25% tax free and was then taxed on the remainder. So for me I had to take a £4k tax hit on the remaining £20k as it is classed as income by HMRC.

[RobertT]

Most people will end up paying a chunk of tax when accessing their DBCBS with Age65 benefits, for two reasons:

1. The original idea of the DBCBS was that it would be used to fund the tax free cash with both Age60 and Age65 benefits, in a similar way to AVC's. But they needed Cabinet Office approval for it to be used with RMSPS benefits, as that's paid by the government. The Cabinet Office said no, so the DBCBS can only be used for the tax free lump sum associated with RMPP benefits. Which is a maximum of 6 years worth of pension(2012-2018), plus as the RMPP are also responsible for a small amount of inflationary increases on Age60 benefits, a small sum might be payable with those.

2. The DBCBS was only meant as a transitional scheme while the legislation for the new CDC(RMCPP) pension was set up. But that took much longer than originally expected and it ended up running for 6.5 years instead of a maximum of 2-3 years.

Add the two things together and you have a lump sum far too big for purpose and anything over the tax free limit is classed as income and therefore tax is likely to be payable.

With the £30k transfer advice limit, the potential get out of jail free card of moving your pot of cash to a personal pension is also effectively removed for many.

[Hyrrokkin]

Most people will end up paying a chunk of tax when accessing their DBCBS with Age65 benefits, for two reasons:

1. The original idea of the DBCBS was that it would be used to fund the tax free cash with both Age60 and Age65 benefits, in a similar way to AVC's. But they needed Cabinet Office approval for it to be used with RMSPS benefits, as that's paid by the government. The Cabinet Office said no, so the DBCBS can only be used for the tax free lump sum associated with RMPP benefits. Which is a maximum of 6 years worth of pension(2012-2018), plus as the RMPP are also responsible for a small amount of inflationary increases on Age60 benefits, a small sum might be payable with those.

2. The DBCBS was only meant as a transitional scheme while the legislation for the new CDC(RMCPP) pension was set up. But that took much longer than originally expected and it ended up running for 6.5 years instead of a maximum of 2-3 years.

Add the two things together and you have a lump sum far too big for purpose and anything over the tax free limit is classed as income and therefore tax is likely to be payable.

With the £30k transfer advice limit, the potential get out of jail free card of moving your pot of cash to a personal pension is also effectively removed for many.

Which is very annoying