Pensions & ISA Flashcards
What is the annual allowance?
£60,000 (gross)
£48,000 (net)
How the does the annual allowance taper for higher earners work?
£1 for every £2 you earn over £260,000 allowance tapered stops at £10,000
At what level of income does it taper?
£260,000 to £360,000
What is the lump sum allowance?
£268,275
How many years of allowance can be carried forward?
Up to 3 previous tax years plus current tax year
Cost to set up a Drawdown -
£200 initial cost
Annual cost to run a drawdown -
£150 thereafter (VAT on top of both)
How old do you have to be to start making contributions to a SIPP?
From birth, after 75 can still make contributions but no longer get tax relief
What are the transfer out fees for a SIPP?
no transfer out fees
What is the fee for commercial property in a SIPP?
£1,200
What is the tax charge on pensions valued in excess of the LTA?
There is no LTA tax charge as of April this year.
What tax relief is earned on personal contributions?
- 20% for basic rate tax payers
- higher rate tax payers get additional 20% if claimed through self assessment and 25% for additional rate
What tax relief is earned on company contributions?
Individuals do not get any tax relief on company contributions
At what age can benefits be taken from a SIPP?
55
increases to 57 in 2028
At what two points is a SIPP tested against the LTA?
When a SIPP is taken into drawdown and at the age of 75
How is a SIPP treated differently if the holder dies before or after 75?
Before 75 the SIPP can be passed down to the beneficiary tax-free, after 75 taxes can be applied. Both circumstances outside of deceased estate for IHT purposes.
A client contributed £30,000 Net to their Killik SIPP, after tax relief how much will be contributed gross?
£30,000/0.8 = £37,500
What does UFPLS stand for?
Uncrystallised Fund Pension Lump Sum - £200 fee
Rate of tax relief on personal contributions received through a Killik SIPP?
20%
If somebody has no income in a tax year, what can they contribute (Gross and Net)
£3,600 Gross & £2,880 Net
What is the maximum percentage of a client’s wealth that can be held in Physical Gold Bullion within their SIPP?
30%
What does QROPS stand for?
Qualified recognised overseas pensions schemes
2 types of drawdown?
Flexi access & Capped drawdown
What are the three pensions crystallisation events?
Going into drawdown, turning 75 or death
