magazine archive
magazine archive
Ask Rachel
Should I use a SIPP to supplement my workplace pension?
Thursday 25 Apr 2024I’m going to be 50 next year, and so far, I have saved about £18,000 in a workplace pension. I have been automatically enrolled since 2016. My question is should I stick with it and get a SIPP pension as well? Or should I just put more in the workplace one until retirement? I hadn’t really thought...
Can I leave some of my pension to my favourite charity when I die?
Thursday 18 Apr 2024I would like to leave my favourite charity some money from my pension when I die. My husband will inherit my other assets through my will, and he will have enough money to be comfortable. We don’t have any children. Can I do this? I thought there was a lot of flexibility to leave my pension money...
Why am I getting less income from my pension pot despite setting a fixed monthly amount?
Thursday 11 Apr 2024I have been taking a fixed income of £500 a month from my pension drawdown pot. I have not changed this amount, yet this month’s income is a lot lower. Why is that? Florence Rachel Vahey, AJ Bell Head of Public Policy, says: Let’s start by looking at how pension income is taxed. When first taking...
Have the rules changed on how pensions are taxed when you die?
Thursday 04 Apr 2024I have read that there was a HMRC consultation on the abolition of the lifetime allowance which contained a proposal that from April 2024 untouched pension pots would be subject to income tax when they were passed on death. Whereas now the pot is not taxed if the individual dies before age 75. I...
How can you pay into a grandchild’s ISA?
Thursday 28 Mar 2024My mother wants to pass some money over to invest in my daughter’s future. She was considering whether she could set up a Junior ISA and then how much she could pay into it. My daughter turns 16 in a couple of months’ time. Andrew Rachel Vahey, AJ Bell Head of Public Policy, says: A Junior ISA can...
Should I reinvest funds from my retirement pot in an ISA?
Thursday 21 Mar 2024I am 64, a homemaker, and unemployed with two tax years to go before I receive my state pension at 66 years old. I have a SIPP, that I have not yet touched. I also have an ISA. I would like to take an income for the next two tax years before I receive my state pension. I’m considering moving my...
Can I take a 25% tax-free lump sum if I’ve started drawing on defined benefit pension scheme?
Thursday 14 Mar 2024I took my pension from my defined benefit scheme in 2017. At the time I chose not to take any cash lump sum. I also have a SIPP which I have not yet touched. So, my question is – can I take a quarter of my SIPP as tax-free cash? Robin Rachel Vahey, AJ Bell Head of Public Policy, says: A few weeks...
I’ve paid into more than one ISA of the same type, what do I need to do now?
Thursday 07 Mar 2024Over the last few years, I have been paying into two different Stocks & Shares ISAs with different providers. However, I have just found out that this was against the rules, and have stopped my payments in. Could you confirm this and let me know what happens now, and what action I need to take...
What is my maximum tax-free allowance with individual protection 2016?
Thursday 29 Feb 2024I have individual protection 2016. I took my public service pension in 2019 with a tax-free lump sum below the current cap of £268,275, which is based on 25% of the current lifetime allowance of £1,073,100. I also have an uncrystallised SIPP (with AJ Bell). In the next financial year, I’m planning...
What are ‘relevant earnings’ when it comes to claiming pension tax relief?
Thursday 22 Feb 2024I understand I will get tax relief on my pension contributions up to my ‘relevant earnings’ but what are these? Are they my earnings or do they include my investment income as well? Can I still receive tax relief even if I have not paid any tax on my earnings (because they are too low)? Caroline...
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