Benefits unsecured

Question 1

How often are the maximum income limits reviewed for a capped DD?

Answer 1

Every 3 years, or annually if over 75

Question 2

An individual is an additional rate taxpayer and has a pension of £135,000 and the annuity rate is 4.7%. If he wanted to achieve a first year income of £14,000, how much would he have to crystallise?

Answer 2

PCLS = £25
750.550.047=£1.94
For every £100 crystallised, individual would receive £26.94.
14000*(100/26.94)=£51967.33

Question 3

In what situations would an individual be unable to take an UFPLS?

Answer 3

Funds already in DD
They have enhanced/primary protection
They have scheme-specific protected TFC
They are a beneficiary looking to take the death benefits

Question 4

What is type A critical yield?

Answer 4

Growth needed to provide and maintain an income equal to a notional annuity

Question 5

What is type B critical yield?

Answer 5

Growth needed to provide & maintain the client’s selected level of income