Pension lump sum to be taxed?

Discussion in 'Army Pay, Claims & JPA' started by All_I_Want, Mar 31, 2008.

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  1. As in the title (Pension lump sum to be taxed) is it so?

    My admin office say that this is coiming in soon, anyone have any idea of when/if?
  2. techically you get taxed already (as you pay a penalty for having all that cash in a oner), if you were to work out the difference between if youd taken the larger monthly amount against the amount you get if youve taken the smaller monthly amount, then times it by the number of months until you hit 55, youd notice that you actually dont get the full amount in your lump sum if you work out the difference between small lump and large lump sum divided by number of months until youre 55.
    So if they were to tax the lump sum they surely would have to alter how the commuted lump sum is worked out, you can't get taxed twice on the same money (although this is Labour).

    It makes sense or rather did when the pensions bloke explained it in my FAR. Small lump sum & larger monthly pension v massive lump sum & smaller monthly pension, it all evens out and the govt still gets its pound of flesh.

    But in answer to your question, err I dont know, first Ive heard of it.