MPAA

[Rapido123]

Hi, I have a personal pension of which I have already taken the 25% tax free lump sum and I’m now looking at taking the rest as a drawdown income monthly. My question is I also have Flexiplan and wondered if I would still be able to transfer this to a drawdown fund and access the funds as above or could that be affected by the MPAA or does this only affect new contributions to pensions, thank you

[Wullie10]

When I rang Standard Life they told me transferring funds does not affect the MPAA. It does not count as part of the £10,000 pa limit.

[Rapido123]

Thank you

[RobertT]

Transferring your AVC's to a SIPP has no bearing on the MPAA, because all you're doing is moving your money from one pension to another. It's similar to transferring an ISA – that doesn't affect the £20k per year limit either.

But as soon as you flexibly take any cash from a money purchase/defined contribution pension over the 25% tax free amount, you will trigger the MPAA.

More info on the MPAA is here: https://www.moneyhelper.org.uk/en/pensi ... wance-mpaa

[Wullie10]

I also read somewhere that money paid in the current tax year in to a AVC or whatever then transferred is classed part of the MPAA once it is triggered.

[RobertT]

I don't know where you got that from but I don't believe it's right. 
I've never heard of it before anyway!

Anything withdrawn from a DC pension over and above the 25% tax free amount is classed as income and will therefore trigger the MPAA.

You can then only pay in a total of £10k per year into DC pensions from then on, and that includes employer contributions and tax relief.

It might be worth pointing out that any UFPLS that you might take from your RM pension via AVC's or the DBCBS, means you're taking taxable cash and will therefore also trigger the MPAA.