I receive a final salary pension and I have £150k left below my lifetime limit of £1.5M (IP 2014).
I have also got a SIPP of £300k which I am interested in emptying in a tax-efficient way (all
figures are approximate).
I am thinking of:
1. crystallising £50k in this tax year and in the next 2 tax years in order to keep taxable income
below £100k p.a. in each year, assuming that £12.5k would be tax free and the rest taxable at the
higher rate.
2. Having used up the lifetime allowance in 2018-19, then taking out the rest (£150k +) as a lump
sum and paying 55% tax - the lump sum being used to help with a house purchase.
My reading of the rules is that I could not use the total SIPP (£300k) to calculate my tax free
cash (£75k). Is this the case?
Do steps 1 & 2 above seem sensible? or are there other tax-efficient ways of emptying the SIPP?
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