magazine archive

magazine archive

Ask Tom

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...

What does the coronavirus market turmoil mean for my pension?

Thursday 12 Mar 2020

What are the implications of the coronavirus outbreak on people like me who have a significant sum invested in the FTSE 100 via their pension? Paul The most important thing to do in the face of what is an unexpected and uncertain period for investors is not panic. We have seen extremely volatile...

How do I take full advantage of pension tax relief?

Thursday 05 Mar 2020

Under a ‘relief at source’ arrangement how much money do I need to pay into my SIPP (from taxed income) to take advantage of the full annual pension allowance of £40,000? Is it £40,000 or some lesser amount? Neil Tom Selby, AJ Bell Senior Analyst says: If you save in a pension you are entitled to...

What happens to pension assets if I get divorced?

Thursday 20 Feb 2020

I know this makes me a bit of a misery guts, but I’m getting married in a year and started thinking about what happens to my assets – and particularly my pension – if we get divorced. Clearly this isn’t my plan or hope, but equally I want to be prepared just in case. Ben Tom Selby, AJ Bell Senior...

What do I need to know about the Scottish budget?

Thursday 13 Feb 2020

I know everyone is focused on the main UK Budget next month, but is there anything I need to be aware of from the Scottish Budget? I live in Ayrshire and have taxable income of £45,000 a year and pay around £5,000 a year into my ISA. I also receive about £3,000 in dividends via my general...

Help, I’ve missed the full tax relief on my pension

Thursday 06 Feb 2020

I’ve been paying into my workplace group personal pension (GPP) for just over three years and only just realised I’m missing out on pension tax relief. I earn £70,000 a year and pay about £5,000 of this into my GPP (matched by my employer). However, I’ve only been receiving basic-rate (20%) tax...

Should I use a Lifetime ISA for retirement savings?

Thursday 30 Jan 2020

I’ve been saving in a SIPP but wanted to know if the Lifetime ISA is worth considering for some of my retirement money (I already own a house)? I’m paying in about £5,000 a year so far and receiving 40% tax relief (20% automatically and 20% through my tax return). Matt Tom Selby, AJ Bell Senior...

‘How could inflation measurement changes affect my income?’

Thursday 23 Jan 2020

If the Government replaces RPI with CPIH, what will happen to existing contracts? I am currently in receipt of an annuity paying just over £15,000 that increases in line with RPI, while my wife has a small defined benefit pension which also enjoys RPI-linked rises. Will our incomes effectively be...

‘How do VCT and EIS products work alongside a pension?’

Thursday 16 Jan 2020

I’ve maxed out my pensions lifetime allowance of £1,055,000 and am looking for alternative ways to invest my money in a tax efficient way. Can you explain how VCTs and EIS product work? David Tom Selby, AJ Bell Senior Analyst says: ISAs are the best known alternative to pensions, allowing you to...

‘How does the lifetime allowance test at 75 work?’

Thursday 19 Dec 2019

My SIPP is currently worth £900,000. If I crystallise the fund into drawdown today, will that mean I avoid a lifetime allowance charge if it subsequently grows in value above £1,055,000? Romesh Tom Selby AJ Bell Senior Analyst says: There are a number of ‘benefit crystallisation events’ which HMRC...