magazine archive
magazine archive
Ask Rachel
Can I make contributions to a SIPP if I’m drawing a final salary pension?
Thursday 22 Aug 2024I am 59 and have a deferred defined benefit pension. I currently work as a consultant and bill my clients through a limited company; the company pays my monthly salary and the company makes contributions to my personal SIPP. If I decided to start drawing my defined benefit pension and continue to...
What happens if I pass my pension on to my wife after I’ve turned 75?
Thursday 15 Aug 2024I have a SIPP and am currently 65 years old. If I die before the age of 75, I believe the holdings can be passed on to my wife (without any tax problems). If I die over 75, what happens when I pass holdings to my wife? Would my wife need a SIPP with the same provider so that the holdings could be...
As a higher-rate tax payer can I use a SIPP to reduce my tax bill?
Thursday 25 Jul 2024I am earning above the £50,000 tax threshold and want to pay money into a SIPP to avoid paying 40% tax. I also have existing shares and want to avoid paying dividend tax so am also keen to put these into a SIPP. Can I transfer existing shares into a SIPP using ‘Bed & SIPP’ and also claim tax...
What happens to my pension if I die before 75 and what are the tax implications?
Thursday 18 Jul 2024I am 72 and retired. I am aware that if I die after my 75th birthday my Pension Pot would be taxed as income by my beneficiaries (wife and children). As this would no doubt incur some 40% liability, would it make sense to draw from the SIPP up to my 20% income tax limit in the next 3 years rather...
How am I taxed on withdrawals from my pension?
Thursday 11 Jul 2024I retired officially a couple of years ago. At the time I had a big increase in my income, so I increased the amount put into long-term investments, and I spend the dividends generated by them. I also have several savings accounts. I started a SIPP recently. My current intention is not to touch it...
What is a transitional tax-free amount certificate and why would you need one?
Thursday 04 Jul 2024I retired in 2019 at the age of 65. I recently (i.e. this tax year) tried to withdraw cash from a private pension, but the provider told me that I might (or might not) need a transitional tax-free amount certificate (TTFAC). But they failed to explain what a TTFAC was or how it might apply in my...
What is pound cost ravaging and how can I guard against it?
Thursday 27 Jun 2024I am planning on finishing work in a few months’ time and want to take my tax-free cash from my pension pot. I understand the rest of my pot will remain invested. However, I have been reading up on this and how to manage the investment. A couple of sources have mentioned ‘pound cost ravaging’. What...
Should I transfer my workplace pension scheme to a SIPP?
Thursday 20 Jun 2024I am currently considering my retirement options and have a question regarding transferring my pension from a workplace scheme to a SIPP (self-invested personal pension). I’m wondering if it’s possible to make such a transfer and what considerations or steps might be involved in the process. Diego...
I want to leave funds in my SIPP to my granddaughter, how do I go about it?
Thursday 13 Jun 2024I’m currently 70 years old and intend to leave whatever is left in my SIPP to my granddaughter who is 17 years old. What are the current regulations regarding at what age she would be allowed to access the money, and is there any method to ensure it stays invested until she is of pensionable age?...
If I already have a salary sacrifice pension should I move to a SIPP?
Thursday 30 May 2024If you already have a salary sacrifice pension from your employer, is there anything to gain by moving to a SIPP? Anonymous Rachel Vahey, AJ Bell Head of Public Policy, says: Before answering it’s probably worth quickly explaining what salary sacrifice is and how it works in relation to a pension...