tax on pension lump sum

D

dockingtrade

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If you dont deduct the 25% value of todays pension from your tfa on your lump sum ie (dont use -C in scscb), what rate is that then taxed at when you do take the lump sum when you retire.

Is it 20% up to 36000K 41% on the rest just like normal income?
The tax rate you were at when you waived it?
Or 41% on all?
or 20% on all?

ta
 
You won;t have the option to take a lump sum on retirement from your normal scheme. However, if its a PRSA or you have AVCs - you can transfer that to an ARF and take it out as a taxed lump sum- and it will be taxed at your marginal rate at that time.

Unless rules are all changed before then of course.
 
The waiving of a tax free lump sum to enhance your redundancy payment only applies to the lump sum applying to the pension accured while in that employment. So any new pension you accure you will be entitled to a tax free lump sum from then on. Again, if the rules stay as they are.
 
Does anyone think that the Dec 09 budget will bring in a tax on lump sums? My father is due to retire next year but is now unsure whether he should go early...
 
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