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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 2 pension schemes. 1. Independent personal scheme

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I have 2 pension schemes.
1. Independent personal scheme through standard life
2. pension through my company. I make a contribution and my company makes a contribution.
I will be 55 this year and want to cash in pension 1.
If I do this can I keep on contributing to my pension in 2.

Hi. My name is*****'m looking at your question now and will post my answer or ask for more information here in a short while.

You can continue to contribute to your company scheme.

Each individual has an annual allowance of £40,000 which is the most that can be contributed to all your pension schemes in any one tax year. That takes account of company and personal contributions. However, if you do tale a pension which is effectively what you are doing by cashing in pension 1, then your annual allowance may be reduced to £10,000. You should take this up with pension plan provider 1. When you contact them to tell them you want to cash in the pension, you should tell them that you have a company scheme too and ask them how cashing in pension 1 affects your annual allowance. Alternatively, contact an indepenedent financial adviser. Take a look here for more iinformation on the annual allowance.

I hope this helps but letmem know if you have any further questions.

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