magazine archive

magazine archive

Ask Tom

Just how does the lifetime allowance work?

Thursday 21 Oct 2021

Mr A (aged 50) starts a SIPP with £10,000 and does not make any further annual contributions over the next 10 years into the SIPP or any other pension, and the value of the that £10,000 grows to, say, £1 million, how would the £1 million pension fund be assessed against the lifetime allowance?...

Should my wife have all her income paid into a SIPP?

Thursday 14 Oct 2021

My wife is nearly 64 and will retire in the next two years. Together with a business partner she manages two nursery schools. This is a limited company (50% each) and for the last couple of years she has paid herself a minimal amount in salary, with the rest taken in the form of dividends totalling...

Why is it costing me to leave a with-profits pension?

Thursday 07 Oct 2021

I was sold a pension policy by one of the big insurers in the late 1990s which was half unit-linked, half with-profits. Since 1999 they have applied a so-called ‘MVR’ to the with-profits portion which means it will cost me 10-15% of the fund to move to a SIPP. How can this possibly be fair? Graham...

Would I be better off without salary sacrifice?

Thursday 30 Sep 2021

I have been contributing to two pensions in the last few years – my SIPP and my workplace pension. My workplace contributions are made through salary sacrifice and I contribute 40% of my earnings together with an 11% employer contribution. This means the earnings on my P60 for the last two years...

Help, I don’t understand the flexi-access options for pensions

Thursday 23 Sep 2021

I want to take annual lump sums from my pension pot in retirement, each made up of a 25% tax-free component and the balance in taxable income subject to my personal tax allowance. I don’t want to take all of my 25% tax free at the outset. I can’t see the difference between flexi-access drawdown/...

What are my social care options?

Thursday 16 Sep 2021

After reading about social care reforms, I’ve realised I have very little knowledge of the products and options available. Can you provide an overview please? Ryan Tom Selby, AJ Bell Head of Retirement Policy says: There aren’t a huge number of specific solutions available for those who self-fund...

Can I cash out all my pensions in one go from age 55?

Thursday 09 Sep 2021

Can I cash out all my pensions in one go from age 55? I’m thinking of doing this as I don’t really trust pensions and would rather have control of my own money. Christopher Tom Selby AJ Bell Head of Retirement Policy says: This depends on the type of pension you have. The state pension pays an...

How can I protect myself against a wealth tax?

Thursday 02 Sep 2021

How can I protect my money if the Government introduces a wealth tax? I’ve worked hard and saved all my life – how can it be fair for politicians to come after people who have done the right thing? Tom Tom Selby, AJ Bell Senior Analyst says: It’s important to kick off with a bit of context. While...

Can you help me with the ‘dos’ and ‘don’ts’ of drawdown?

Thursday 26 Aug 2021

I’m 65, active and enjoy my flexibility. Because of that I’m fairly sure I don’t want to buy an annuity. Could you offer some basic ‘dos’ and ‘don’ts’ for anyone wanting to stay invested in drawdown? Moira Tom Selby, AJ Bell Senior Analyst says: While buying an annuity is a one-and-done decision –...

How is the lifetime allowance tested at 75?

Thursday 19 Aug 2021

I’d appreciate it if you could explain how the assessment of pension funds against the lifetime allowance/fixed protection amount works at age 75. In particular are pension commencement lump sums added back to the scheme values? Stephen Tom Selby , AJ Bell Senior Analyst says: The lifetime...