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| The truth about pension withdrawal and tax |
If you’re planning to cash in your pension pot, you need to
be fully aware of the tax rules or you could be in for a nasty tax shock.
From 6th April 2015, if you’re over the age of 55,
you are now free to cash in your Defined Contribution (DC) pension savings.
Apart from a tax-free lump sum of
25%, you will be liable to pay income tax on the rest.
Also:
If the amount you withdraw takes your
annual income over £42,386, you’ll pay 40% tax
So it might not be in your best interests to take out your
whole pension; it could actually be better to stagger the payments.
As with any financial dealings, it’s always best to take
independent advice, and we will be happy to introduce you to a financial
consultant if you would like to chat to someone about your pension.
Of course, we’re always here to talk through any tax
concerns and work out the best ways for you to maximise your income.
Our tax
planning services cover a range of business strategies to benefit companies, as
well as specific plans to make sure individuals receive everything they’re
entitled to – including pension pot tax issues.
Above all we recommend you take time to digest the changes
and take expert professional advice BEFORE you make any decisions, there is no
rush.
To get in touch, click here or request a free of charge call
from our website www.taxandaccountancysolutions.co.uk
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