Cash balance

[billycat]

Thankyou so much Robert.

[mistheword]

A question for Robert if I may. I have had my cash balance figures and I am due payment at the end of October. The final figure of taxable sum is £30000 if that is added to my earnings so far this tax year it would take my earnings to over £50000 thus hitting the 40% bracket. My question is would I see the extra tax coming out my wages straight away thus effecting my take home pay until the end of this tax year. Or would the tax department wait till the new tax year in April and adjust my tax code to claim back owed tax. I plan to retire in June so I don’t really want to see all my monthly Royal Mail pension going to the tax man.
Have you any idea Robert how it works etc

[RobertT]

I think the tax will start to be taken more or less straight away, but it's possible any over or under payment of tax may also roll over into the next financial year if it's not all sorted before then.

There's probably a few on here who know a bit more about these things than me, and they might be along to give more advice.

If in doubt, it's not a bad idea to contact HMRC and tell them what's going on and ask how it's likely to work.

[mistheword]

Thank you for reply I suppose it’s a wait and see situation

[freespeech]

Could somebody give me a rough estimate on what I can expect from my nra65 pension annual figures £2675plus £675 I have an avc with £13000 also my cash balance is around £35550i want to keep as much annual pension as possible roughly how much tax free money would I generate of these figures also roughly how much would I have left to be taxed thanks in advance if anybody can work this out for me.

The DBCBS can only be taken with RMPP Age65 pension, so is all of that £2,675 from the RMPP or is some of it from the RMSPS?
What is the £675?

I have a recent "live" quote and interestingly the NRA60 options include approx 20% of the DBCBS so if anyone is thinking about their NRA60 pension in isolation this may be useful.

[RobertT]

Could somebody give me a rough estimate on what I can expect from my nra65 pension annual figures £2675plus £675 I have an avc with £13000 also my cash balance is around £35550i want to keep as much annual pension as possible roughly how much tax free money would I generate of these figures also roughly how much would I have left to be taxed thanks in advance if anybody can work this out for me.

The DBCBS can only be taken with RMPP Age65 pension, so is all of that £2,675 from the RMPP or is some of it from the RMSPS?
What is the £675?

I have a recent "live" quote and interestingly the NRA60 options include approx 20% of the DBCBS so if anyone is thinking about their NRA60 pension in isolation this may be useful.

Yes, my reply should have said most of the DBCBS can be taken with Age65, with in some cases a small amount with Age60.

That amount will be under Age60 final salary pension on the RMPP annual illustrations and relates to the amount of RMSPS Age60 inflationary increases the RMPP are responsible for.

If I remember correctly, you moved functions within RM and under the changes from 2014, your final salary pay increased accordingly. Hence you will be able to take more DBCBS with Age60 than most.

[freespeech]

Could somebody give me a rough estimate on what I can expect from my nra65 pension annual figures £2675plus £675 I have an avc with £13000 also my cash balance is around £35550i want to keep as much annual pension as possible roughly how much tax free money would I generate of these figures also roughly how much would I have left to be taxed thanks in advance if anybody can work this out for me.

The DBCBS can only be taken with RMPP Age65 pension, so is all of that £2,675 from the RMPP or is some of it from the RMSPS?
What is the £675?

I have a recent "live" quote and interestingly the NRA60 options include approx 20% of the DBCBS so if anyone is thinking about their NRA60 pension in isolation this may be useful.

Yes, my reply should have said most of the DBCBS can be taken with Age65, with in some cases a small amount with Age60.

That amount will be under Age60 final salary pension on the RMPP annual illustrations and relates to the amount of RMSPS Age60 inflationary increases the RMPP are responsible for.

If I remember correctly, you moved functions within RM and under the changes from 2014, your final salary pay increased accordingly. Hence you will be able to take more DBCBS with Age60 than most.

You have a good memory Robert! I left RM in April and was hoping my redundancy would last until I'm 60 in April next year. Although now half way through that period everything still looks good I have just requested a new quote which would include increases to my AVC's and DBCBS (around £10k if my last day of service summary letter is correct). I'm really concerned about the budget in November and my birthday just days away from the new tax year so any delays could put me into 2026/27 and any budget changes "could" also be from 26/27 tax year. I recognise there are a lot of "could" there but I expect to have a combined (NRA60/65) tax free figure in the ball park of £200k (inc a small element of UFPLS where my DBCBS amount is more than the tax free element of NRA65) and if there is even a slight chance of some of that becoming taxable it would screw my plans now I have retired. I'm hoping taking NRA 60 three months early will help this.....although I still need to consider whether I take the NRA65 funds at the same time........I can't believe I planned this well for almost 40 years and I now have to second guess the last few months.

[July 1981]

Could somebody give me a rough estimate on what I can expect from my nra65 pension annual figures £2675plus £675 I have an avc with £13000 also my cash balance is around £35550i want to keep as much annual pension as possible roughly how much tax free money would I generate of these figures also roughly how much would I have left to be taxed thanks in advance if anybody can work this out for me.

The DBCBS can only be taken with RMPP Age65 pension, so is all of that £2,675 from the RMPP or is some of it from the RMSPS?
What is the £675?

I have a recent "live" quote and interestingly the NRA60 options include approx 20% of the DBCBS so if anyone is thinking about their NRA60 pension in isolation this may be useful.

Yes, my reply should have said most of the DBCBS can be taken with Age65, with in some cases a small amount with Age60.

That amount will be under Age60 final salary pension on the RMPP annual illustrations and relates to the amount of RMSPS Age60 inflationary increases the RMPP are responsible for.

If I remember correctly, you moved functions within RM and under the changes from 2014, your final salary pay increased accordingly. Hence you will be able to take more DBCBS with Age60 than most.

I took mine in October last year receiving the UFPLS in January, I owed £4500 paying £60 pounds per week until the end of this financial year.

[RobertT]

You have a good memory Robert! I left RM in April and was hoping my redundancy would last until I'm 60 in April next year. Although now half way through that period everything still looks good I have just requested a new quote which would include increases to my AVC's and DBCBS (around £10k if my last day of service summary letter is correct). I'm really concerned about the budget in November and my birthday just days away from the new tax year so any delays could put me into 2026/27 and any budget changes "could" also be from 26/27 tax year. I recognise there are a lot of "could" there but I expect to have a combined (NRA60/65) tax free figure in the ball park of £200k (inc a small element of UFPLS where my DBCBS amount is more than the tax free element of NRA65) and if there is even a slight chance of some of that becoming taxable it would screw my plans now I have retired. I'm hoping taking NRA 60 three months early will help this.....although I still need to consider whether I take the NRA65 funds at the same time........I can't believe I planned this well for almost 40 years and I now have to second guess the last few months.

Yes, you've gone from wanting to make sure you get your pension in the 26/27 tax year to save some tax, as you said in this thread a few months ago. To wanting to take your pension before 26/27 starts, to save some tax.

My personal opinion on this hasn't changed since we last wrote about it – I don't think the tax free limit will be reduced in the budget!

There's lots of other ways RR can raise more money and if she's got her eyes on pensions, the biggest windfall open to her is to abolish higher rate tax relief. Which I read somewhere costs the government about £15 Billion a year.
Plus, any changes might not be from April 2026 anyway.

I can understand the concern as I'm likely to be affected too if the limit gets reduced down to some of the figures mentioned in the press. Unfortunately all we can do is wait and see what happens...

[freespeech]

You have a good memory Robert! I left RM in April and was hoping my redundancy would last until I'm 60 in April next year. Although now half way through that period everything still looks good I have just requested a new quote which would include increases to my AVC's and DBCBS (around £10k if my last day of service summary letter is correct). I'm really concerned about the budget in November and my birthday just days away from the new tax year so any delays could put me into 2026/27 and any budget changes "could" also be from 26/27 tax year. I recognise there are a lot of "could" there but I expect to have a combined (NRA60/65) tax free figure in the ball park of £200k (inc a small element of UFPLS where my DBCBS amount is more than the tax free element of NRA65) and if there is even a slight chance of some of that becoming taxable it would screw my plans now I have retired. I'm hoping taking NRA 60 three months early will help this.....although I still need to consider whether I take the NRA65 funds at the same time........I can't believe I planned this well for almost 40 years and I now have to second guess the last few months.

Yes, you've gone from wanting to make sure you get your pension in the 26/27 tax year to save some tax, as you said in this thread a few months ago. To wanting to take your pension before 26/27 starts, to save some tax.

My personal opinion on this hasn't changed since we last wrote about it – I don't think the tax free limit will be reduced in the budget!

There's lots of other ways RR can raise more money and if she's got her eyes on pensions, the biggest windfall open to her is to abolish higher rate tax relief. Which I read somewhere costs the government about £15 Billion a year.
Plus, any changes might not be from April 2026 anyway.

I can understand the concern as I'm likely to be affected too if the limit gets reduced down to some of the figures mentioned in the press. Unfortunately all we can do is wait and see what happens...

Wise words.......thanks. The reason for the change of approach (other than the budget) is I didn't factor in the 16 week (or so) delay to receiving the UFPLS fund (some of which is taxable for me) so although my current approach would give me funds in this tax year the actual tax payable will only be on the monthly pension amounts for Jan-March.

[Wullie10]

The tax problem will affect a lot of posties soon as state pension will be 67. Would anyone wish to continue to 67 getting whacked for higher tax at least for one year ? Taxing people more just takes away incentive to work. Something the politicians can't understand.

[NWpostie]

It's my plan to retire as soon as able and affordable, I don't see the point of working and paying 40% tax, between now and to NRA60 you should have an escape plan in place, building up savings, maxing out your AVCs and taking the max tax free lump sum available, once you got the money you need to sit down and work out if you can survive or thrive on the pension money alone until you claim your 67 state pension.

That's bottom line really.

[SeanMc]

You have a good memory Robert! I left RM in April and was hoping my redundancy would last until I'm 60 in April next year. Although now half way through that period everything still looks good I have just requested a new quote which would include increases to my AVC's and DBCBS (around £10k if my last day of service summary letter is correct). I'm really concerned about the budget in November and my birthday just days away from the new tax year so any delays could put me into 2026/27 and any budget changes "could" also be from 26/27 tax year. I recognise there are a lot of "could" there but I expect to have a combined (NRA60/65) tax free figure in the ball park of £200k (inc a small element of UFPLS where my DBCBS amount is more than the tax free element of NRA65) and if there is even a slight chance of some of that becoming taxable it would screw my plans now I have retired. I'm hoping taking NRA 60 three months early will help this.....although I still need to consider whether I take the NRA65 funds at the same time........I can't believe I planned this well for almost 40 years and I now have to second guess the last few months.

Yes, you've gone from wanting to make sure you get your pension in the 26/27 tax year to save some tax, as you said in this thread a few months ago. To wanting to take your pension before 26/27 starts, to save some tax.

My personal opinion on this hasn't changed since we last wrote about it – I don't think the tax free limit will be reduced in the budget!

There's lots of other ways RR can raise more money and if she's got her eyes on pensions, the biggest windfall open to her is to abolish higher rate tax relief. Which I read somewhere costs the government about £15 Billion a year.
Plus, any changes might not be from April 2026 anyway.

I can understand the concern as I'm likely to be affected too if the limit gets reduced down to some of the figures mentioned in the press. Unfortunately all we can do is wait and see what happens...

Wise words.......thanks. The reason for the change of approach (other than the budget) is I didn't factor in the 16 week (or so) delay to receiving the UFPLS fund (some of which is taxable for me) so although my current approach would give me funds in this tax year the actual tax payable will only be on the monthly pension amounts for Jan-March.


I have just received my Confirmation of Payment letter for my NRA65 benefits and it says that the UFPLS will be paid with the first monthly pension payment. So no 16 week wait.

[freespeech]

You have a good memory Robert! I left RM in April and was hoping my redundancy would last until I'm 60 in April next year. Although now half way through that period everything still looks good I have just requested a new quote which would include increases to my AVC's and DBCBS (around £10k if my last day of service summary letter is correct). I'm really concerned about the budget in November and my birthday just days away from the new tax year so any delays could put me into 2026/27 and any budget changes "could" also be from 26/27 tax year. I recognise there are a lot of "could" there but I expect to have a combined (NRA60/65) tax free figure in the ball park of £200k (inc a small element of UFPLS where my DBCBS amount is more than the tax free element of NRA65) and if there is even a slight chance of some of that becoming taxable it would screw my plans now I have retired. I'm hoping taking NRA 60 three months early will help this.....although I still need to consider whether I take the NRA65 funds at the same time........I can't believe I planned this well for almost 40 years and I now have to second guess the last few months.

Yes, you've gone from wanting to make sure you get your pension in the 26/27 tax year to save some tax, as you said in this thread a few months ago. To wanting to take your pension before 26/27 starts, to save some tax.

My personal opinion on this hasn't changed since we last wrote about it – I don't think the tax free limit will be reduced in the budget!

There's lots of other ways RR can raise more money and if she's got her eyes on pensions, the biggest windfall open to her is to abolish higher rate tax relief. Which I read somewhere costs the government about £15 Billion a year.
Plus, any changes might not be from April 2026 anyway.

I can understand the concern as I'm likely to be affected too if the limit gets reduced down to some of the figures mentioned in the press. Unfortunately all we can do is wait and see what happens...

Wise words.......thanks. The reason for the change of approach (other than the budget) is I didn't factor in the 16 week (or so) delay to receiving the UFPLS fund (some of which is taxable for me) so although my current approach would give me funds in this tax year the actual tax payable will only be on the monthly pension amounts for Jan-March.


I have just received my Confirmation of Payment letter for my NRA65 benefits and it says that the UFPLS will be paid with the first monthly pension payment. So no 16 week wait.

Thanks......did you take it early or at 65?

[SeanMc]

You have a good memory Robert! I left RM in April and was hoping my redundancy would last until I'm 60 in April next year. Although now half way through that period everything still looks good I have just requested a new quote which would include increases to my AVC's and DBCBS (around £10k if my last day of service summary letter is correct). I'm really concerned about the budget in November and my birthday just days away from the new tax year so any delays could put me into 2026/27 and any budget changes "could" also be from 26/27 tax year. I recognise there are a lot of "could" there but I expect to have a combined (NRA60/65) tax free figure in the ball park of £200k (inc a small element of UFPLS where my DBCBS amount is more than the tax free element of NRA65) and if there is even a slight chance of some of that becoming taxable it would screw my plans now I have retired. I'm hoping taking NRA 60 three months early will help this.....although I still need to consider whether I take the NRA65 funds at the same time........I can't believe I planned this well for almost 40 years and I now have to second guess the last few months.

Yes, you've gone from wanting to make sure you get your pension in the 26/27 tax year to save some tax, as you said in this thread a few months ago. To wanting to take your pension before 26/27 starts, to save some tax.

My personal opinion on this hasn't changed since we last wrote about it – I don't think the tax free limit will be reduced in the budget!

There's lots of other ways RR can raise more money and if she's got her eyes on pensions, the biggest windfall open to her is to abolish higher rate tax relief. Which I read somewhere costs the government about £15 Billion a year.
Plus, any changes might not be from April 2026 anyway.

I can understand the concern as I'm likely to be affected too if the limit gets reduced down to some of the figures mentioned in the press. Unfortunately all we can do is wait and see what happens...

Wise words.......thanks. The reason for the change of approach (other than the budget) is I didn't factor in the 16 week (or so) delay to receiving the UFPLS fund (some of which is taxable for me) so although my current approach would give me funds in this tax year the actual tax payable will only be on the monthly pension amounts for Jan-March.


I have just received my Confirmation of Payment letter for my NRA65 benefits and it says that the UFPLS will be paid with the first monthly pension payment. So no 16 week wait.

Thanks......did you take it early or at 65?


NO