Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[LC0112G]

And it is a decent pension unlike the UK pension which is the worst. In Europe despite being one of , if not, the richest country

But the basic pension doesn't include all the other stuff handed out on a plate like housing and heating.

People who didn't take a penny in benefits generally have some sort of private pension to afford them some sort of standard of living. Although if you worked as a teacher they tax that pension as income

All private pensions are taxed as income, as soon as you are over the zero threshold its tax as normal (and the state pension counts towards that).

Unless they were invested post tax. In which case you only pay capital gains. AIUI.

A pension is a kind of tax wrapper. They are usually set up as a kind of trust fund, and as such the 'owner' of the pension doesn't actually 'own' the investments within the pension, although they are reserved for the eventual benefit of the 'owner'. It's subtle, but that's why a pension fund is not counted as an asset in bankruptcy or liable for death duties/taxes - because the 'owner' doesn't actually 'own' it at all.

An asset within a pension fund is generally free grow (or fall) free of all taxes - whether that be Capital Gains, Corporation tax, Dividend tax, whatever.

Not sure how you expect to pay CGT on an asset owned by a pension fund though. If you're calling a Buy To Let your 'pension', then yes you may well pay CGT on the BTL when you come to sell, but it's not really a pension in the true legal meaning of the word. If you die, it'll be liable for death duties. If you sell you'll pay CGT on any profit.

All cash income from a ALL pensions is liable to income tax - doesn't matter if its state pension, public pension, private pension or workplace pension. The state pension is usually paid 'tax free' because it is (usually) less than the personal allowance (£12700 at the moment). However, once your total income, including all pension income, exceeds your personal allowance then you will pay tax on any amounts above the personal allowance.

[Doctor Gollum]

CGT would be applicable to any retirement investment in addition to a traditional pension pot.

[LC0112G]

CGT would be applicable to any retirement investment in addition to a traditional pension pot.

If you mean that CGT can be charged on almost any investment EXCEPT a traditional pension pot, then yes I agree.

Buying something with post tax income, and then paying CGT on any gains makes no sense to me, and is basically the reason that Pension pots and ISA's exist.

[Doctor Gollum]

CGT would be applicable to any retirement investment in addition to a traditional pension pot.

If you mean that CGT can be charged on almost any investment EXCEPT a traditional pension pot, then yes I agree.

Buying something with post tax income, and then paying CGT on any gains makes no sense to me, and is basically the reason that Pension pots and ISA's exist.

Except that, unlike ISAs, Roth IRAs aren't capped. So whilst your investment grows, you only pay CGT on what you draw down. And if you happen to live somewhere with no income tax, then CGT can be significantly cheaper.

[Migv6 le Frog Fan]

This reminds me - I am a trustee of a small social club which ( believe it or not) has £30,000 sat in a current account earning no interest. So effectively losing about 10% of its value per annum.
When I found out about ths a couple of weeks ago I told all concerned we need to do something about it and quickly.
Anyone got any good info on where best to put these funds without tying them up for years to come please ? 

[LC0112G]

Except that, unlike ISAs, Roth IRAs aren't capped. So whilst your investment grows, you only pay CGT on what you draw down. And if you happen to live somewhere with no income tax, then CGT can be significantly cheaper.

Huh? UK ISA's aren't capped. You can 'only' pay in £20K per year, but once invested the funds can grow without limit. Lots of people with £1M+ in their ISAs. And in an ISA there is no CGT, or income tax to pay when you take the money out.

I've never heard of a Roth ISA - a quick google seems to suggest it's a US thing. Appears to be limited to $6K/$7K input per year. UK ISAs are limited to £20K input per year.

Not sure getting involved with the US IRS is a good idea either unless you're already involved as a US citizen.

[STEMO]

Except that, unlike ISAs, Roth IRAs aren't capped. So whilst your investment grows, you only pay CGT on what you draw down. And if you happen to live somewhere with no income tax, then CGT can be significantly cheaper.

Huh? UK ISA's aren't capped. You can 'only' pay in £20K per year, but once invested the funds can grow without limit. Lots of people with £1M+ in their ISAs. And in an ISA there is no CGT, or income tax to pay when you take the money out.

I've never heard of a Roth ISA - a quick google seems to suggest it's a US thing. Appears to be limited to $6K/$7K input per year. UK ISAs are limited to £20K input per year.

Not sure getting involved with the US IRS is a good idea either unless you're already involved as a US citizen.

Didn't you know Al was a financial guru?

[Doctor Gollum]

Except that, unlike ISAs, Roth IRAs aren't capped. So whilst your investment grows, you only pay CGT on what you draw down. And if you happen to live somewhere with no income tax, then CGT can be significantly cheaper.

Huh? UK ISA's aren't capped. You can 'only' pay in £20K per year, but once invested the funds can grow without limit. Lots of people with £1M+ in their ISAs. And in an ISA there is no CGT, or income tax to pay when you take the money out.

I've never heard of a Roth ISA - a quick google seems to suggest it's a US thing. Appears to be limited to $6K/$7K input per year. UK ISAs are limited to £20K input per year.

Not sure getting involved with the US IRS is a good idea either unless you're already involved as a US citizen.

Didn't you know Al was a financial guru?

In the words of Tony Robbins... I am not your guru

[STEMO]

The only safe way for risk averse novices is ISA. Steady growth and tax free.

[Migv6 le Frog Fan]

For individuals, your probably right.

[STEMO]

For individuals, your probably right.

Individuals, yeah. Individual savings account 

[Migv6 le Frog Fan]

Well I say that because, someone in our club the other night, who claims to have a lot of financial know how, suggested we bung all the clubs spare money into an ISA.