Taking NRA 65 Benefits early calculation worry.

[mr hil.]

One extra factor I think needs considering is when you take the £18853 it is counted as income and will be added to any earnings you have for that tax year, so you must add the value of your monthly/annual pension amounts to any salary you have earned in that tax year too. If this breaches the £50270 basic rate limit anything above £50270 is taxable at 40% not 20%.

This is one reason to transfer out the cash balance or AVCs to a scheme where you can use drawdown to be able to keep below that higher tax thresheold.

That is my understanding of how things work but may be mistaken?????

[RobertT]

I was wondering if my calculations are close to being correct or have I got a lot to learn

Your obvious figures are correct.

However, once you've taken the tax free element of the Cash Balance, the remainder will be paid out as a UFPLS, meaning 25% of that is also tax free.
So a bit more than you expected in your pocket instead of the taxman's.

Based on your figures of taking RMPP Age65 at 60:
Annual pension = £1,644
Cash Balance tax free = £15,673(£10,960 + £4,713)
Cash Balance taxable = £14,140

You'll also have the RMSPS element of Age65.
The Cash Balance can't be used to fund any lump sums with that!


As Mr hil says, money from wages and pensions(excluding the tax free element) counts as earned income and is taxed accordingly.

[Stef]

Thanks mr.hil and RobertT for your knowledge it is very much appreciated. Legends

[ANDREW CROCOMBE]

After contacting various people,RM, PCS I am left with no idea what or how to get my 65 pension, or even what it's worth.Lump sum and/or pension etc.Even had an email doubting I work for Royal Mail All I wanted was an idea, 64 this year and maybe retiring early.Guess I'll have to waste time and ring them whilst I'm out delivering eh. Had similar problems when getting my 60 pension,took ages to sort out.

[Hitcher]

After contacting various people,RM, PCS I am left with no idea what or how to get my 65 pension, or even what it's worth.Lump sum and/or pension etc.Even had an email doubting I work for Royal Mail All I wanted was an idea, 64 this year and maybe retiring early.Guess I'll have to waste time and ring them whilst I'm out delivering eh. Had similar problems when getting my 60 pension,took ages to sort out.

Don't you get yearly updates?

[ANDREW CROCOMBE]

Got some cash value thing last year, all i need is whether id get a lump sum of that amount and/or its added to the pension.Quite simple id have thought.

[RobertT]

Got some cash value thing last year, all i need is whether id get a lump sum of that amount and/or its added to the pension.Quite simple id have thought.

The majority of the Cash Balance is paid as a lump sum with Age65 benefits, with a relatively small amount sometimes paid with Age60.
Some will be tax free, some will be taxable.
For more info look at the RMPP website....

If you want to know how much you're going to get, just ask for a quote. You can do that online too:
https://www.royalmailpensionplan.co.uk/ ... ment-form/

They won't be able to provide figures over the phone because there's over 100,000 members and it takes time to get your info and work out your options.
The whole process, from asking for a quote to receiving your first payment, typically takes 3-4 months.