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Ask Rachel
If I dip into my SIPP then return to work what would be my tax-free allowance?
Thursday 10 Oct 2024I am 59 and have recently taken time off work to provide care and support to my parents. I am a little undecided as to whether I will return to work or call it quits and retire. As such, I would like to take lump sums from my SIPP once a year. So, I have two questions: Should I return to work, will...
How can I lower my income to below the £100,000 threshold?
Thursday 03 Oct 2024I am drawing a final salary pension and the state pension. Very soon, the total of these will take me over £100,000 in annual income when I will start to lose my annual personal allowance of £12,570 and my effective tax rate will be 60%. I have minimised other income outside of ISAs, i.e. dividends...
How will I be taxed when I start drawing income from a SIPP and my state pension?
Thursday 26 Sep 2024During my working life, I have only ever had a single income stream, so tax has just been simple(ish) PAYE. However, that is about to change. I currently get an income from a defined benefit pension, then next year I will also get the state pension, then I will also start drawing-down income from...
Can we put the proceeds from a property sale into a SIPP?
Thursday 19 Sep 2024My wife and I are both pensioners receiving state pensions. We are both self-employed earning between £5,000 and £10,000 a year each, plus we both receive income from renting a commercial property (total around £20,000 per year). My wife receives a pension from the NHS of around £7,500 a year. We...
How much can I pay into a pension as director of my own limited company?
Thursday 12 Sep 2024I am a director of my own limited company. Currently I take a salary up to my personal allowance, and receive the rest of my remuneration as dividends. I have heard that through carry forward I can pay in an employer’s pension contribution up to £180,000 gross. But that this may be limited by the...
What happens if I name one of my daughters as a beneficiary of my SIPP and she lives abroad?
Thursday 29 Aug 2024I’m over 75 and have a SIPP. My beneficiaries are my daughters, one who has a SIPP already, and one who doesn’t as she lives in France. So, when I die, the daughter based in the UK can receive her share in her SIPP. Can you tell me what happens to the other daughter’s share, the one who lives in...
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...