Pre ADay Pension in Payment - valuing for LTA at first post ADay BCE

Client was in receipt of DB Scheme pension prior to ADay. Looking to crystallise funds from him MP pot now - this is the first BCE post ADay.

Scheme pension initially in payment was circa £12K pa.
Scheme pension in payment immediately before BCE is £10K pa

Income drop relates to a state pension deduction under the DB scheme rules.

According to current HMRC PTM (https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm088300):

Valuing the pre-ADay BCE is 25 x 10K in this instance.

Anyone aware of any quirk in valuing pre-ADay scheme pensions where there has been a drop in income since ADay?

Ta

Comments

  • I don't know. But I think i'd say you're right - it's simply 25x10 this year.

    Presumably the client had a bridge to SPA or something (explaining the drop)?

  • richallumrichallum Administrator

    It's definitely 25 x £10,000 and not the pension at A Day.

    Paraplanner. F1, Apple, Nutella, ice cream. No trite motivational quotes. Turning a bit northern. Republican.

  • JonaJona Member

    Great - so for people on such circumstances (where GMP bridge / state pension deduction exists) they luck out (in LTA terms) if first BCE is after DB scheme income drop.

  • Yep, seems so. It's an-ever decreasing scenario though as 2006 gets further away.

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