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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15977
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I have a SIPP worth approximately £180,000 - how much tax will

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I have a SIPP worth approximately £180,000 - how much tax will I have to pay if I fully redeemed the total amount?
#Thanks + regards

The tax you would pay would depend on the level of your other income in the same tax year. If you could let me know what that is likely to be, I can do some calculations.
Customer: replied 2 years ago.

There is no income for the current tax teat


Leave this with me while I draft my answer.
Hi again.

My answer is based on the assumption that this is your only pension plan and that you don't have pension savings over £1,250,000. Take a look here and here for information on the lifetime pension savings limit and the potential tax charges on the excess over the protected limit.

If you have no income other than the SIPP redemption in 2015/16, you will pay £47,643 in tax. The first 25%, £45,000, of the payout will be tax free leaving £31,785 taxable at 20% (£6,357.00) and £103,215 taxable at 40% (£41,286.00).

You will lose your personal allowance as your income will be over £121,200. You lose £1 of the personal allowance for every £2 of income in excess of £100,000.

I hope this helps but let me know if you have any further questions.
Customer: replied 2 years ago.

Hi Tony - I took a 25% tax free allow on a protected pension which was transferred to a SIPP in previous tax year 2014-15

There has been no other income in the current tax year

Hope this clarifies my question

Best regards


You are entitled to a 25% tax free sum for the total of your pension savings up to £1.25 million. The limit may be higher than £1.25 million if you protected your funds in earlier years.
Customer: replied 2 years ago.

Hi there, I have a secondary pension of approx. £250k which I am not touching so could you clarify the exact amount of tax I would pay if I fully redeemed the SIPP of 180K based on the above.

Many thnks


How much were your total pension savings worth before you withdrew any cash from them for the first time?
Customer: replied 2 years ago.

Combined value of approx. £450k



Based on the combined value of £450,000 and assuming that you are not taking a tax free lump sum from the same SIPP as the previous tax free lump sum, then my previous tax figures won't change.
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