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[LC0112G]

I know this is going to make it more complicated but there are a couple of misunderstandings above.

The £4K allowance applies in a different set of circumstances than just not touching the 75%

https://www.moneyadviceservice.org.uk/en/articles/money-purchase-annual-allowance/amp

Second and this is a common misunderstanding, it is an allowance not a limit.  You can even in those circumstances described above, contribute more than £4K but the tax relief is limited to £4K of contributions and remember for the purpose of the allowance employer contributions are included

Ok I over simplified. However there is rarely any point in putting your own money into a pension if you don't get the tax relief on the way in, but are then taxed on (75% of) the money you take out.

You also refer to a 'pot'. I assume that means it's a real pot of money/investments - called a Defined Contribution Pension. Private Pensions, SIPPs and Stakeholder are the 3 main types of DC Pension. If it's not a DC pension ,

The three main types of defined contribution plan used in the workplace are : trust based, group personal pension and master trust.  Group SIPP is not that popular and stakeholder is an obsolete product

The OP is talking about an old pension scheme, so whilst Stakeholder may be obsolete today, it's is a possibility.

[LC0112G]

.

If you don't touch the remaining 75% then you can continue to put more than £4K p/a into your other pensions.

You learn something new every day,.thanks for that 

Would I be correct in assuming this has no effect on the Lifetime Allowance?

There is no direct link between paying money into a pension and the LTA.

It only kicks in if you "crystallise" more than (currently) £1.055 million of pension pot. Crystallise basically means 'cash in', so you can take out up to £263K tax free, and up to £791K as taxable income. After you've taken that amount out there is no more 25% tax free, and there is an additional 25% 'tax' charge on 100% of the remainder/excess.

If the combined value of all your pension pots looks likely to approach £1M+ then you'd be a fool not to see an IFA now!

[biggriffin]

 Spoken to my pension provider, and I can withdraw up to 25% without having to move what's left in the pot.. Which is what I was wanting to do. 

 Know do I buy a Marina, a vxrV8 or the new bathroom...  It's a tough decision.  I know what that wurzel would say. My heart says V8, my life expectancy says Bathroom.

[Doctor Gollum]

Empty the lot and only pay tax on it once at this year's rate rather than constantly paying tax on the annuity. Reinvest it post tax and you'll only pay tax on the gain, and then only when you draw it down...
Capital gains is significantly less than higher rate income tax.

[LC0112G]

Empty the lot and only pay tax on it once at this year's rate rather than constantly paying tax on the annuity. Reinvest it post tax and you'll only pay tax on the gain, and then only when you draw it down...
Capital gains is significantly less than higher rate income tax.

That depends how much money is in the pot, and how much you currently earn from the day job. If it's (say) £20K then you can take £5K tax free and the other £15K at your current tax rate - so you would possibly only pay 20% tax on it (depends what other income you have this year).

However, if there is (say) £100K in the pot, then you can take £25K tax free, and the rest is taxable. You will pay 40% tax on at least some, and perhaps all of it - a tax bill of £30K.

If there is £1M in the pot, then £250K is tax free and the other £750K is taxable. You'll pay 45% on most of that - so you'll get a tax bill of up to £337K .

The purpose of a pension is to provide you an income once you stop working. Taking taxable money out of the pension whilst you are still working means you will pay un-necessary tax. If you wait till you stop working then you'll have all of your personal tax allowance (£12K) and all of your 20% tax band (£38K) to withdraw the balance without pushing you into the 40/45% tax bands.

You don't have to buy an annuity any more, although they are still suitable for very risk averse people. There is (usually) no point in taking taxable money out of a pension to put it into investments. You can buy most investments inside the pension, and inside the pension they grow tax free and with no CGT. 

[Doctor Gollum]

There's that... I may have confused it with an reasonable inheritance.

[LC0112G]

There's that... I may have confused it with an reasonable inheritance.

And since you mention inheritance...

Most personal pensions can be inherited completely tax free by whoever the deceased nominates - either as cash or a pension pot for themselves. No death/inheritance payable by the deceased's estate, and no income tax or CGT for the person that inherits.

Another reason not to take money out of the pension wrapper if you'd like the remainder of your money to pass tax free directly to someone else when you expire.

[dave the builder]

.....

 now do I buy a Marina, a vxrV8 or the new bathroom...  It's a tough decision.  I know what that wurzel would say. My heart says V8, my life expectancy says Bathroom.

Invest wisely and you can have the best of all 3 

Visit your local pound shop, buy 4 buckets and a pack of 3 car sponges ,total investment £5
1 bucket to wash in with 1 sponge cut up ,1 bucket to sh!t in (don't get them mixed up)
2 buckets and 2 sponges to wash the VXR8 with
then look at a pic of a morris marina online if you must 

my brother and his wife are both accountants and i'm sure neither would dare to argue with my logic 

[Viral_Jim]

If the combined value of all your pension pots looks likely to approach £1M+ then you'd be a fool not to see an IFA now!

I hope this is very likely, but as I'm only 35, I feel I have time yet. 

[STEMO]

If the combined value of all your pension pots looks likely to approach £1M+ then you'd be a fool not to see an IFA now!

I hope this is very likely, but as I'm only 35, I feel I have time yet. 

Well....not to put too finer point on it, Jimmy, and in no way meaning to be disrespectful, do something to make sure you live to see it. 

[aaronjb]

If the combined value of all your pension pots looks likely to approach £1M+ then you'd be a fool not to see an IFA now!

I hope this is very likely, but as I'm only 35, I feel I have time yet. 

Well....not to put too finer point on it, ...

Say I'm the only bee in your bonnet?

[Doctor Gollum]

Blue canary in the outlet by the light switch...

[STEMO]

If the combined value of all your pension pots looks likely to approach £1M+ then you'd be a fool not to see an IFA now!

I hope this is very likely, but as I'm only 35, I feel I have time yet. 

Well....not to put too finer point on it, ...

Say I'm the only bee in your bonnet?

Same goes for you, you both need a kick up the arse 

[aaronjb]

If the combined value of all your pension pots looks likely to approach £1M+ then you'd be a fool not to see an IFA now!

I hope this is very likely, but as I'm only 35, I feel I have time yet. 

Well....not to put too finer point on it, ...

Say I'm the only bee in your bonnet?

Same goes for you, you both need a kick up the arse 

Went back to fat club last night and I'm back to where we started (not originally, I'm still ~4st lighter than that) last year, so yep.. definitely need a kick up the arse. We're back to cooking properly (i.e. everything from scratch) again with no fat, oil, blah blah .. basically all the fun stuff taken out

[Doctor Gollum]

It's all about behavioural change, so mostly mindset