Are you referring to this article
? If so, it only relates to DC pensions, although it could affect RMPP members with AVC's, which is covered here
. And the £4k limit does include employer contributions too!
The advantage of paying into a DC pension while already drawing on it(or different one) above the 25% tax free amount, is that you still get the tax relief and employer contributions(if applicable), which we all know are valuable benefits.
I would agree with heapsy, that taking a DB pension early and so incurring an actuarial reduction, doesn't make sense.
02 Apr 2019, 08:00
Apologies if this muddies the water but this is both perfectly legal and simple to achieve.
See the third article "If you do not pay income tax"https://www.gov.uk/tax-on-your-private- ... tax-relief
02 Apr 2019, 12:22
Individual DC pensions are really just glorified savings accounts, so why wouldn't you want to get a bit of 'free money' to help your balance grow, whether you're already drawing a pension or not?
There are people out there who pay into their pension beyond the age of 55 just to take advantage of the tax relief and then withdraw the full amount shortly afterwards, and so benefit from a nice 25% uplift on their money for doing nothing.
Although you may have to be careful about the tax implications, depending on what other income you have.
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