magazine archive
magazine archive
Ask Rachel
Can I transfer assets from a general investment account into a SIPP?
Thursday 03 Jul 2025I have a GIA (general investment account), currently valued at around £170,000. I’m looking at how best to preserve this investment in the most tax efficient manner. I would like to transfer from the GIA into a SIPP. However, I realise any gains over the £3,000 CGT allowance will be taxed at 18% as...
Can you help me understand the situation now the lifetime allowance has been removed?
Thursday 26 Jun 2025I have two pensions, a BT pension (defined benefits, which I have started to draw from) and a SIPP which is yet to be crystallised. At the time of starting to take my workplace pension in 2022/23, I was told that this amounted to 27% of LTA (lifetime allowance). I took a lump sum as well as a...
How much do pension contributions reduce my taxable income by?
Thursday 19 Jun 2025I’m likely to become a higher rate taxpayer this financial year. If I choose to pay into a SIPP for the tax benefits, how much do I need to invest to reduce my taxable income by £100. Is it £100 or £80? Also how do I then claim the tax back to allow for the 40% rate I will have paid on that £100?...
Can I contribute proceeds from the sale of a property to my SIPP?
Thursday 12 Jun 2025I am currently taking taxable income from a SIPP in drawdown. I will be completing on the sale of a property shortly. Am I able to contribute £10,000 of the sale proceeds from the property to my SIPP under the money purchase annual allowance? Rob Rachel Vahey, AJ Bell Head of Public Policy, says:...
How will I know how much my pension will be worth when I retire?
Thursday 29 May 2025I have a deferred pension due on my 65th birthday. What time scale before this date should I expect to receive details of what the pension will be going forward? Is there any legal requirement on timescales, or best practice, for getting a clear understanding of what information a person should get...
What is the 4% rule and how does it work?
Thursday 22 May 2025I am thinking of starting to withdraw an income from my SIPP later this year. I have heard something about a 4% rule I should apply when working out how much to take from my SIPP. What is this, and is it something I should be following? Kamal Rachel Vahey, AJ Bell Head of Public Policy, says: Over...
Explaining the lump sum allowance and the money purchase annual allowance
Thursday 15 May 2025If a person has defined benefit pension and two SIPPs, can they take a tax-free lump sum from that pension in, say, year 1, and subsequently a monthly taxable income; then in, say, year 4, take a tax-free lump sum from SIPP 1 and start drawdown; then, in, say year 7, take a tax-free lump sum from...
I’m approaching 75 and thinking about how to use my tax-free allowance
Thursday 08 May 2025I’m approaching 75 & thinking about the 25% tax-free allowance. I’ve already taken the 25% from my SIPP. But I also have two stakeholder pensions of about £250,000, and I’m considering taking the tax-free portion and paying it into family ISAs. I assume dying before 75 would be beneficial, tax-...
How does it work if I leave a SIPP to a beneficiary?
Thursday 01 May 2025I am interested in planning for my beneficiaries as much as my own finances. I understand that my SIPP beneficiaries can inherit their share as a SIPP. Is that right? If they have (or open) an AJ Bell SIPP, can they inherit into their SIPP directly, all done within AJ Bell, not having to go via an...
What is the tax situation when making withdrawals from my pension?
Thursday 17 Apr 2025I am wondering if I have misunderstood how the UFPLS (uncrystallised funds pension lump sum) withdrawal arrangement works and how much tax-free element would be available to me over the lifetime of my pension and its overall withdrawal. I understand there is a lump sum allowance for tax free...