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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5028
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I am currently in the NHS Pension 1995 scheme and can retire

Customer Question

I am currently in the NHS Pension 1995 scheme and can retire early on reduced benefits at age 50 (I am now 54). If I retire now I will get a tax free lump sum of £18,000 and a pension of around £200 a month. I also have a very small private pension, which under the new legislation I could take next year in May when I am 55. This would be £15,000.
Although retiring I will continue to work for myself. I need to know if I take both sums at the same time, will the £18,000 remain tax free. I am aware that 75% of the £15,000 would be taxable and obviously any income that I earn from self employment would be taxable in the usual way.
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

The lump sum payment would be tax free even though you may be cashing in on two separate pension schemes.

Confirmation of this can be found here

https://www.gov.uk/tax-on-pension



I hope this is helpful and answers your question.

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