scooter
Member of DD Central
Posts: 403
Likes: 379
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Post by scooter on Jul 25, 2024 12:40:58 GMT
I have had 6 letters from the NHS in the last 2 weeks. 3 sheets of A4 in each, only one written on. They send reminders by text, can they not send appointments, results, etc by email or text? I know this would be a problem for my parents, but if those who can, opt for it, wouldn't that save a lot of money..... Don't get me started on the top quality stationery MPs use. Sajid Javid wouldn't reply on email because it made the filing more difficult...nuff said.
Isn't there a Govt suggestion box?
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Post by overthehill on Jul 25, 2024 13:06:22 GMT
There is little point putting money into a SIPP at only 20% tax relief if you'll be withdrawing that same money after your state pension starts as you'll pay 20% tax on it. Apart from the 25% you can take tax free. The state pension will use up most of your personal allowance.
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Post by mostlywrong on Jul 25, 2024 13:55:59 GMT
There is little point putting money into a SIPP at only 20% tax relief if you'll be withdrawing that same money after your state pension starts as you'll pay 20% tax on it. Apart from the 25% you can take tax free. The state pension will use up most of your personal allowance.
I have heard that argument before. But I would argue that a SIPP is a very long term, tax efficient, investment and that the ability to lock the money away gives sufficient time for the magic of compounding interest (and dividends) to kick in.
And, in due course, you will benefit from that.
I was late to open a SIPP because I had a company pension and I failed to understand the benefits of adding the SIPP on top of my company pension.
My SIPP is invested globally and has out-performed everything else.
I fully understand that I will probably pay 40% tax on the income from my SIPP in due course and I look forward to having 2 chocolate hob-nobs with my care home coffee.
I am a fan...
MW
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ptr120
Member of DD Central
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Post by ptr120 on Jul 25, 2024 14:06:22 GMT
Those above state pension age should continue to pay National Insurance if the choose to continue to work above pension age. NI is a tax like any other so should be applied regardless of age. Here in Germany people pay the equivalent of social security payments from their pension receipts so there is also scope to consider making private pension receipts NI-able.
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agent69
Member of DD Central
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Post by agent69 on Jul 25, 2024 17:24:20 GMT
There is little point putting money into a SIPP at only 20% tax relief if you'll be withdrawing that same money after your state pension starts as you'll pay 20% tax on it. Apart from the 25% you can take tax free. The state pension will use up most of your personal allowance.
I guess it depends on the nature of the scheme you are in.
I had a salary scrifice scheme with my last employer, and they were generous enough to pay their NI savings into the pot as well as my own. As a consequence for every £1 of take home pay I gave up £2 was paid into my SIPP.
You can also take regular payments from the tax free element of the SIPP.
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Post by bernythedolt on Jul 25, 2024 18:46:45 GMT
There is little point putting money into a SIPP at only 20% tax relief if you'll be withdrawing that same money after your state pension starts as you'll pay 20% tax on it. Apart from the 25% you can take tax free. The state pension will use up most of your personal allowance.
That's not the full story and I'm afraid I can't agree. Firstly, my wife and I contribute our gross £3,600 each - the maximum we are permitted - into SIPPs for two reasons:- - On first death (up to age 75), the survivor picks up the spouse's entire pot free of tax, so it's a great savings scheme.
- Pensions currently lie outside of inheritance tax.
Those are two valid reasons to hold a SIPP in my view. Secondly, you still win mathematically. If you contribute x at 20% tax relief, your pot is immediately worth 5x/4 after that tax relief is applied. Equivalently, call that 20x/16. Even if you assume no growth at all, you can take back 25% of that figure tax free, as you say, so that's 5x/16, with the remaining 15x/16 then dribbled out over the years at 20% tax, meaning you'd receive 80% of that 15x/16, or 12x/16. So your total return works out at 5x/16 plus 12x/16, or 17x/16. Since 17x/16 is greater than the x you initially contributed, you have made a small gain. Around a 6% gain for doing nothing. Of course, you do need to consider whether a SIPP fund is likely to increase at a faster rate than a plain savings account, too. Ours certainly have, but the past is no guarantee of the future, as they say.
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Post by bracknellboy on Jul 25, 2024 19:28:58 GMT
There is little point putting money into a SIPP at only 20% tax relief if you'll be withdrawing that same money after your state pension starts as you'll pay 20% tax on it. Apart from the 25% you can take tax free. The state pension will use up most of your personal allowance.
That's not the full story and I'm afraid I can't agree. Firstly, my wife and I contribute our gross £3,600 each - the maximum we are permitted - into SIPPs for two reasons:- - On first death (up to age 75), the survivor picks up the spouse's entire pot free of tax, so it's a great savings scheme.
- Pensions currently lie outside of inheritance tax.
Those are two valid reasons to hold a SIPP in my view. Secondly, you still win mathematically. If you contribute x at 20% tax relief, your pot is immediately worth 5x/4 after that tax relief is applied. Equivalently, call that 20x/16. Even if you assume no growth at all, you can take back 25% of that figure tax free, as you say, so that's 5x/16, with the remaining 15x/16 then dribbled out over the years at 20% tax, meaning you'd receive 80% of that 15x/16, or 12x/16. So your total return works out at 5x/16 plus 12x/16, or 17x/16. Since 17x/16 is greater than the x you initially contributed, you have made a small gain. Around a 6% gain for doing nothing. Of course, you do need to consider whether a SIPP fund is likely to increase at a faster rate than a plain savings account, too. Ours certainly have, but the past is no guarantee of the future, as they say. You also need to consider whether it would take you over your LTA by the time you draw it, which will change that maths considerably.
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Post by mostlywrong on Jul 25, 2024 19:44:35 GMT
You also need to consider whether it would take you over your LTA by the time you draw it, which will change that maths considerably. I have previously expressed my opinion that the LTA was a stupid tax and its passing was not before time.
However, never say never, and I did not foresee that Labour would grab such a hefty majority.
But I doubt that the LTA in its last iteration will make a reappearance. In an earlier job, Sir Keir himself had negotiated a pension package free of all that LTA tax nonsense and, if there is a u-turn, the political ramifications will reverberate loudly.
I do foresee a lot of fiddling with pensions a la Gordon Brown. There is too much money invested in pensions and most people do not either understand or appreciate the long term nature of pensions.
MW
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Post by bernythedolt on Jul 25, 2024 20:09:35 GMT
That's not the full story and I'm afraid I can't agree. Firstly, my wife and I contribute our gross £3,600 each - the maximum we are permitted - into SIPPs for two reasons:- - On first death (up to age 75), the survivor picks up the spouse's entire pot free of tax, so it's a great savings scheme.
- Pensions currently lie outside of inheritance tax.
Those are two valid reasons to hold a SIPP in my view. Secondly, you still win mathematically. If you contribute x at 20% tax relief, your pot is immediately worth 5x/4 after that tax relief is applied. Equivalently, call that 20x/16. Even if you assume no growth at all, you can take back 25% of that figure tax free, as you say, so that's 5x/16, with the remaining 15x/16 then dribbled out over the years at 20% tax, meaning you'd receive 80% of that 15x/16, or 12x/16. So your total return works out at 5x/16 plus 12x/16, or 17x/16. Since 17x/16 is greater than the x you initially contributed, you have made a small gain. Around a 6% gain for doing nothing. Of course, you do need to consider whether a SIPP fund is likely to increase at a faster rate than a plain savings account, too. Ours certainly have, but the past is no guarantee of the future, as they say. You also need to consider whether it would take you over your LTA by the time you draw it, which will change that maths considerably. LTA was abolished in April 2024.
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registerme
Member of DD Central
Posts: 6,624
Likes: 6,437
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Post by registerme on Jul 25, 2024 20:54:12 GMT
Can we start by reducing the number of members of the House of Lords?
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Post by bracknellboy on Jul 25, 2024 20:55:28 GMT
You also need to consider whether it would take you over your LTA by the time you draw it, which will change that maths considerably. LTA was abolished in April 2024. you are of course completely correct. A temporary brain f*rt on my part. Another success for the consistency of pension policy in this country over the years :-(
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agent69
Member of DD Central
Posts: 6,042
Likes: 4,437
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Post by agent69 on Jul 25, 2024 21:06:15 GMT
Can we start by reducing the number of members of the House of Lords? I thought Labour were committed to removing the remaining hereditary peers, as the first step to reforming the House of Lords
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registerme
Member of DD Central
Posts: 6,624
Likes: 6,437
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Post by registerme on Jul 25, 2024 21:37:19 GMT
Can we start by reducing the number of members of the House of Lords? I thought Labour were committed to removing the remaining hereditary peers, as the first step to reforming the House of Lords Hasn't the last one just died / left / been mummified?
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Post by bracknellboy on Jul 26, 2024 9:02:13 GMT
I thought Labour were committed to removing the remaining hereditary peers, as the first step to reforming the House of Lords Hasn't the last one just died / left / been mummified? that is not something that can be inferred purely from a lack of attendance, apparently.......
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Post by bracknellboy on Jul 26, 2024 9:04:51 GMT
I have had 6 letters from the NHS in the last 2 weeks. 3 sheets of A4 in each, only one written on. They send reminders by text, can they not send appointments, results, etc by email or text? I know this would be a problem for my parents, but if those who can, opt for it, wouldn't that save a lot of money..... Don't get me started on the top quality stationery MPs use. Sajid Javid wouldn't reply on email because it made the filing more difficult...nuff said.
Isn't there a Govt suggestion box? Probably: but you have to hand deliver your suggestion to the Houses of Parliament, written on parchment, and deposit it in the appropriate box. Which is only accessible on Wednesdays between 10:00-11:00, and 15:00-16:00, but not when parliament is in recess.
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