Using Crystallised Pension for purchase of Pension Annuity AND Pension Transfer
ONaylor
Member
Hello
We have a client who's spouse has passed away with a fully crystallised Embark SIPP.
Our client is the sole beneficiary of the pension pot and has received her beneficiary options letter from Embark. She wishes to use part of the pot (approx 65% of total pot) to purchase a Pension Annuity, she then wishes to transfer the remaining funds to a Personal Pension.
Is this possible with already fully crystallised funds? Or would she have to use the whole pot to do "one or the other?"
Would we be better transferring the whole crystallised pot to the new provider first and then using part of the funds to buy an annuity through them?
Embark's options letter and applications forms do not seem to facilitate the two simultaneously.
Thanks in advance!
Comments
You can't partially transfer funds already crystallised. I'm unaware of any necessity to use all the crystallised fund to buy an annuity. Suggest these transactions are done in sequence. If Embark (who are horrendous) cannot facilitate annuity purchase with part of the fund then it will need to be transferred to a provider who can.
The funds are neither crystallised or uncrystallised, they are in limbo awaiting a death benefit decision.
Annuity and Transfer is not possible as transfers are not an allowable death benefit.
It will be up to scheme rules but your only options to meet your objectives are:
Put all in beneficiary drawdown and part annuitise from there.
Part annuitise and part designate to beneficiary drawdown.
You can then do a beneficiary drawdown transfer what's left if you want to go to another scheme.
Or designate as beneficiary drawdown transfer to other scheme then part annuitise there.
Thanks very much for your advice!
Information :-)