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Lump sum from pension & benefits

(10 Posts)
mpe1967 Mon 16-Oct-17 11:29:58

Morning,

Does anyone know - if you take a lump sum from your pension at 55 is the money classed as income or savings for means tested benefits. Plenty of information about tax and lump sum at retirement but can't find the answer for this.

Thanks 😀

AndNoneForGretchenWieners Mon 16-Oct-17 11:31:45

I think it's income for the financial year in which it's received, then after that savings.

mpe1967 Mon 16-Oct-17 11:38:02

😢 blast was hoping to use some of it to achieve a life long yearning for a cruise before my mobility gets that bad I can't get out.

Babyroobs Mon 16-Oct-17 11:56:45

it won't affect non means tested disability benefits anyway. You can have as many savings or as much income as you like.

Babyroobs Mon 16-Oct-17 11:57:15

What benefits exactly are you referring to?

Babyroobs Sat 21-Oct-17 00:39:46

Well it wouldnt affect things like DLA or Pip but woukd affect means tested benefits like housing benefit or income related esa.

MyBrilliantDisguise Sat 21-Oct-17 00:40:42

It's not taxable.

ChessieFL Sat 21-Oct-17 09:35:34

MyBrilliantDisguise it could be taxable. You can take up to 25% of your pension savings as a lump sum tax-free, but if you take more than that under the ‘freedom and choice’ rules it’s taxable.

mintbiscuit Sat 21-Oct-17 16:21:05

it could be taxable. You can take up to 25% of your pension savings as a lump sum tax-free, but if you take more than that under the ‘freedom and choice’ rules it’s taxable.

^this

The remaining 75% of your pension could be taxable depending on what your taxable income is. If you stay under your personal allowance for the year you may not end up paying any tax when withdrawing remaining 75%.

Auspiciouspanda Sat 21-Oct-17 20:01:49

Are you taking about housing benefit? Taking a lump sum out of your pension isn't used as income just capital amount. Not sure about esa or jsa.

I'm a housing benefit assessor btw

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