Just a thought. There are special taxation rules if your pension pot goes over £1.3 million or so. You don\’t get tax relief is it?Or you pay more tax because of the relief you\’ve had? Something like that?
The last time I asked this question I was told that public sector pensions were subject to the same rules, some method was used to add up future payments and compare them to the sum required to purchase an equivalent annuity. This was then measured against the £1,3 million limit and the appropriate tax then levied (or not, as the case may be).
The civil servant who became infamous for declaring his department was doomed is to pick up the most generous public-sector pension ever awarded — worth a total of almost £2.7 million — when he retires this month.
Will his pension pot be caught by these rules?