This step-by-step summary explains how to set up a tax-efficient regular income option (we call this ‘TRIO’) on your client’s Collective Retirement Account.
What you’ll need to get started
- Your client’s bank details (if not previously added to the system).
- Details of the annuity purchase age.
- Details of the desired tax-free lump sum per payment, payment frequency, and first withdrawal date.
- Lifetime allowance (LTA) percentage used. This is the total LTA used with any other pension scheme, plus the LTA used in any other pension accounts your client holds with us (including any pensions held on the platform under a different account number to this or any pensions held with Old Mutual Life Assurance Limited).
- Details of the desired assets to fund the payment(s).
- Details of any taxable income.
Setting up tax-efficient regular income from an existing Collective Retirement Account
① From the homepage, search for the relevant client.
② From the client’s dashboard select the uncrystallised Collective Retirement Account.
③ Click on the ‘Money out’ quick link button at the top of the screen and select ‘Take Pension benefits’.
④ Complete the questions relating to the advice that’s been given.
- You’ll need to confirm that your client does not have a pre-A-day pension, drawdown or annuity that started before 6 April 2006 that you have not informed us about previously.
- If your client has any form of pension protection which they are using for this withdrawal then you will need to complete the ‘Pension protection’ section.
- Select the withdrawal type as ‘Tax-efficient regular income option’ from the dropdown menu and update the annuity purchase age if required (this must be 10 years older than their current age, up to a maximum age of 99).
- Enter the tax-free lump sum amount required per payment.
- Select the payment frequency from the dropdown menu and enter the first withdrawal date. This must be at least 10 working days from the current date and can be any date between the 1st and the 28th of the month.
- Enter any lifetime allowance percentage used outside of this arrangement. This will then generate the ‘Total lifetime allowance previously used on this account’ percentage.
- Add an ongoing adviser fee, if you are taking one. If previous Benefit Crystallisation Event has occurred, this will be greyed out and the fee will automatically be prepopulated
- Choose the assets to sell to pay withdrawals and charges and to move to the client’s crystallised account. This can be either proportionally across all assets or from specified assets. Please note that if there is insufficient value in an asset at the time of the sale then the remainder is funded from product cash. If product cash is then depleted, funded by proportional deduction from assets.
- Click ‘Next’.
⑤ On the next screen:
- If taxable income is required in addition to the tax-free cash select ‘Yes’ and enter the amount in the ‘Gross Income required per withdrawal’ The maximum of 75% of the crystallised amount will be shown next to this box. If your client does not take the maximum amount of income available per payment, the residual amount will be moved to their crystallised account.
- Use the dropdown menu to select the client’s bank details. If required, you have the option to split the payment over two accounts.
⑥ The next screen allows you to review the information you have entered.
- Use the ‘Edit’ options to make any amendments.
- Review the information, tick the declaration and click ‘Submit’.
- To amend a tax-efficient regular income option, go to your client’s account dashboard, click on the ‘More’ button at the top, and select ‘Edit Income Drawdown’.
How do I set up tax-efficient regular income from a pension video