magazine archive

magazine archive

Ask Tom

How does the pensions test at age 75 work?

Thursday 28 May 2020

Can you please explain how the lifetime allowance test at age 75 works? My fund is in drawdown and has been hit hard by the pandemic, so I’m tempted to withdraw some or all of it now. If I do this will the money I take out be tested? Chris Tom Selby ,AJ Bell Senior Analyst says: The amount you can...

What can I put into a pension now I’m retired?

Thursday 21 May 2020

I finished my last employment in November 2018 and that was when I made my last pension contribution. I opened a SIPP just before this and put in a small amount of cash. I am effectively retired at 59 but living off cash savings and have recently received an inheritance and a matured endowment. Can...

I’m told I can access my pension early, is this true?

Thursday 14 May 2020

I received a phone call from someone saying I could access 50% of my pension today through a loan scheme. I’m 50 years old and while my job is secure for now, it’s entirely possible that will change. I have no other savings, so it would be useful if I could access my pension in this way. Stephen...

Are the rules on holding residential property in a SIPP going to change?

Thursday 07 May 2020

Are there any signs that the ban on holding residential property in a SIPP may be relaxed? There will be an awful lot of vacant/non income-producing properties currently held in SIPPs within the bar/restaurant/hospitality/retail sector as a result of the current crisis which would be very suitable...

What’s the risk of holding more than £85,000 cash in a SIPP?

Thursday 30 Apr 2020

I have more than £85,000 in cash in my SIPP at the moment. What is the risk of holding money beyond this threshold? A reader Tom Selby, AJ Bell Senior Analyst says: The reason £85,000 is an important number for savers and investors to remember is because it is one of the key Financial Services...

How does the taxman top up my pension contributions?

Thursday 23 Apr 2020

I have been told the annual allowance for a SIPP is £40,000 (£32,000 personal contributions + £8,000 tax relief) but how do I get the £8,000 from the taxman? And can I backdate for the previous three years and put in £40,000 x three in the current tax year, as well as my £40,000 existing allowance...

Why can’t I transfer my defined benefit pension?

Thursday 16 Apr 2020

I am considering transferring my defined benefit (DB) pension to a SIPP. I am a keen private investor, with a sizeable portfolio, which I’ve managed for many years. I am being stymied at every turn. If an IFA provides a transfer suitability report to say that it is right for me to transfer then...

What do I need to know before I start drawing down on my pension?

Thursday 09 Apr 2020

After reaching my 60th birthday last month I took the opportunity to crystallise my pension into drawdown, taking my 25% tax-free lump sum in the process. I’m now planning to start taking an income from the taxable part of my fund – is there anything I need to be aware of before I go ahead? Kathryn...

What happens to pension contributions if I’m furloughed?

Thursday 02 Apr 2020

I’m one of a number of employees at my firm who could be ‘furloughed’ for up to three months. I currently earn £50,000 and want to know what it’ll mean for my workplace pension (I’m currently paying in the legal minimum under automatic enrolment). Christopher Tom Selby, AJ Bell Senior Analyst says...

Will I be caught by the annual allowance tax taper?

Thursday 19 Mar 2020

I’m trying to figure out if I am going to be caught by the annual allowance tax taper both this tax year and next. I’m going to have taxable earnings of £150,000 this year, and have used up the full £40,000 annual allowance (50% my contributions, 50% from my employer). My earnings and pension...