RMDCP pension question

[realitybites]

I am now 62 and doubt I will be returning to the work force. I don't claim any benefits as have savings. I have @ £45k in my pension pot. Can I take this over a period of 5 years. I have no other income and this is below my tax allowance will I pay tax on my pension?

[RobertT]

As long as your income from wages or pension is below the personal tax allowance(currently £12,570) in any one financial year, income tax is not payable.

You will be able to take 25% of your pot tax free, so only around £34k will be classed as income, which can be drawdown over a period of time to help you avoid tax.

This provides info on how a DC pension works and what you can do with it: https://www.moneyhelper.org.uk/en/pensi ... on-schemes

[Postie Malone]

I'm not sure whether the RMDCP cates for drawdown or whether you would need to transfer the pot out to a SIPP in order to do this.

As Robert says, you should be able to draw the full amount down over several years using your personal allowance to avoid paying tax on it. You should take care over the amount you draw in the current tax year if you have been receiving pay up to this point. Try to keep your total income below your personal tax allowance. The same also applies to the year in which you start receiving your state pension as you will need to consider the amount of state pension that you will get in your calculations.

[RobertT]

I'm not sure whether the RMDCP cates for drawdown or whether you would need to transfer the pot out to a SIPP in order to do this.

The RMDCP member guide to benefits doesn't mention the need to transfer out for drawdown.
Although a call or email to confirm might be a good idea for anyone wanting to do that.

Page 17: https://adviser.scottishwidows.co.uk/as ... 0353sw.pdf

[realitybites]

Thank you both, left over a year ago so pretty sure I should be ok. Just need to get some income up till I retire on my state pension so looks good.