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As there has been a lot of talk here lately about buying physical gold, I took the plunge. When I look at my one ounce gold Britannia, which probably needed several tons of rock from miles below the earth to produce it, it brings it home to me the scale of the whole mining business.
Might buy a few more as my one does seem rather insignificant.
Knocky
Spades and Red,
Between us we have tried to explain and warn. But reading back,I reckon it will still be as clear as mud to some. It is designed to be this way. There must be quite a few folk here with big SIPP gains. Get advice now, please.
Knocky
Red,
The most efficient way of dealing with it is to die just before you get to 75. You are still hit with the charge, but you can leave the balance tax free outside of your estate. Admittedly there is an obvious downside.
Knocky
Spades,
It is not that simple I'm afraid. The 25% is a charge not a tax at age 75. Any income taken from the pension after this is still taxed as income at the usual 20, 40 or 45% rate.
Please, pay for advice from an expert. It will cost a few hundred quid, but could save 10s of thousands.
Knocky
The LTA is a very complicated charge. At 75 you will have to pay, and again at death. Most people don't get to realise what it means until it is too late. There are things you can do to reduce the charge, but these have to be done long before you start to draw down your pension. The charge can be made from pension funds though, which is the only good thing about it. I still have a few years until I hit 75, and am hoping that this very unfair practice will have been stopped by then. I urge anybody with a SIPP, no matter how young, to pay for advice long before it seems necessary. A nice problem to have maybe, but unfair, unnecessary and very poorly explained or warned about.
Knocky.
Mush, you've made my day. I had worked out that you liked your films, but you hadn't mentioned Buster Scruggs. As a bit of a Waits geek, I am rather biased, but it is a brilliant movie.
Best to you in Portugal,
Knocky
944, get advice from an expert. The LTA is more complicated than it looks. A mistake or an assumption can cost you dear. I speak from personal experience, but £500 of advice was money well spent. If I had done it earlier I would probably have saved a fortune. As it is, because of GGP, if I will have a charge to pay at 75 or at death, if sooner of about £600,000. It's a nice problem, but I could have lessened it by understanding the rules earlier.