A weird pension conundrum....I need help.

[Lozz360]

Tax! The back payment will be £15300 which is above the tax threshold of £12570. How this sum is treated will decide whether or not it's taxable. If you have no other income and if this is treated as annual income in a single tax year the tax due will £545. For every additional £1000 of income you have in the same tax year £200 tax will be payable

You are assuming Dave has no income at all, other than this potential windfall. He has private pensions of approx £3k per annum. He most likely gets a state pension, so he is probably already close to the tax threshold of £12570. Therefore, the majority of the £15,300 would be taxable, although he may get 25% of it tax free with the right help.

 

[Lozz360]

It could be worth asking CAB but do they have the relevant expert advice? Your bank should be able to help but do they charge for this type of service? In this instance the bank would effectively be acting as an FA and I would expect to pay for the service.

Also, I would hope that if the CAB didn’t have relevant expert advice they would refer Dave to more suitable advice. The CAB should be a good starting point.

A bank would be able to be a FA but they are not independent FA’s. They will try and sell Dave financial products that are not even relevant to his question. If we are going to recommend the services of a FA on this forum we should be clear that it should always be an Independent Financial Advisor IMHO.

 

[PaulSB]

You are assuming Dave has no income at all, other than this potential windfall. He has private pensions of approx £3k per annum. He most likely gets a state pension, so he is probably already close to the tax threshold of £12570. Therefore, the majority of the £15,300 would be taxable, although he may get 25% of it tax free with the right help.

Can I suggest you read my initial post again in which I say:

"If you have no other income....." The word "if" shows I've made no such assumption. I assumed nothing and I chose not to make any assumptions on his £3k pension and state pension which could be in a range of values. You'll also see I indicated any other income would increase his tax burden.

 

[Lozz360]

Can I suggest you read my initial post again in which I say:

"If you have no other income....." The word "if" shows I've made no such assumption. I assumed nothing and I chose not to make any assumptions on his £3k pension and state pension which could be in a range of values. You'll also see I indicated any other income would increase his tax burden.

All I was saying was that your tax calculation assumed Dave had no other taxable income when it is clear that he does have other taxable incomes.

 

[PaulSB]

All I was saying was that your tax calculation assumed Dave had no other taxable income when it is clear that he does have other taxable incomes.

Precisely and that is exactly what I did and made it very clear my calculation assumed no other income.

 

[fossyant]

I'd fill the forms in yourself. Don't do it all in one go if you find it daunting, just do a section. You'll then have it completed quite quickly.

 

[Dave7]

Update.
I contacted the accountant that I used when working.
They put me onto a pension expert.
I have sent him all the blurb and he says that between him and the accountant they can sort it.
No charge from the pension guy but the accountant will charge (as he should).

 

[cougie uk]

Any developments Dave ? You must have worked for the relevant company for a couple of years at least to get £1700 a year from them ?
Good luck with it !

 

[Dave7]

Any developments Dave ? You must have worked for the relevant company for a couple of years at least to get £1700 a year from them ?
Good luck with it !

Update.
I had a pension advisor do all the paperwork so as to be certain it is100% correct.......all 40 pages of it..
It is being posted recorded delivery this morning.
Apparently I am due £14,500 L/S plus the annual pension.
I still have no idea of which company it was but I am not asking any questions.

 

[Beebo]

Update.
I had a pension advisor do all the paperwork so as to be certain it is100% correct.......all 40 pages of it..
It is being posted recorded delivery this morning.
Apparently I am due £14,500 L/S plus the annual pension.
I still have no idea of which company it was but I am not asking any questions.

That’s a lovely unexpected bonus for you.
I presume you’ll spent it all on the latest S Works mega bike? You’ll even have 1p change.
https://www.rutlandcycling.com/bike...MIxb3Pi56D9AIVlK3tCh1lpgBnEAQYASABEgKAlPD_BwE

 

[Deleted member 1258]

That’s a lovely unexpected bonus for you.
I presume you’ll spent it all on the latest S Works mega bike? You’ll even have 1p change.
https://www.rutlandcycling.com/bike...MIxb3Pi56D9AIVlK3tCh1lpgBnEAQYASABEgKAlPD_BwE

How Much!

 

[Dave7]

That’s a lovely unexpected bonus for you.
I presume you’ll spent it all on the latest S Works mega bike? You’ll even have 1p change.
https://www.rutlandcycling.com/bike...MIxb3Pi56D9AIVlK3tCh1lpgBnEAQYASABEgKAlPD_BwE

I already have 2 of them......why would I want another one?