1. SIPP Seminars 2012 #SIPPS2012 This is not a consumer advertisement, it is intended for professional financial advisers and should not be relied upon by private customers or any other persons

2. Suffolk Life is the trading name of Suffolk Life Pensions Limited (registered in England and Wales number 1180742) and Suffolk Life Annuities Limited (registered in England and Wales number 1011674). Both are authorised and regulated by the Financial Services Authority. The registered address of both companies is 153 Princes Street, Ipswich, Suffolk IP1 1QJ. Telephone calls to Suffolk Life are recorded for training, monitoring and fact verification purposes. Suffolk Life provides, operates and administers self-invested personal pensions and similar pension products. Information regarding tax and practice is based on Suffolk Life's understanding at the time this presentation was put together of legislation and HM Revenue and Customs policy. Legislation and HM Revenue and Customs policy and practice may change in the future. This presentation is for adviser use only and is not to be used with clients. Tel: 0870 414 7000 Fax: 0870 414 8000 Web: www.suffolklife.co.uk E-mail: ifaenquiries@suffolklife.co.uk

3. End of Tax Year Pensions Checklist Claire Brooks Pensions Technical Manager

4. Agenda Carry Forward Fixed Protection Protected rights Flexible drawdown

5. Carry Forward

6. 26 August 2015 Carry forward basics £10k £35k £25k £50k 2008-09 2010-112011-122009-10 £40k £25k £15k Maximum tax relievable contributions for 2011-12 £130,000

7. 26 August 2015 The rules Must have been a member of a scheme in the year in which carry forward is being carried from Must have earnings to support personal contributions in the year in which they are paid – Not the year they are carried forward from – Not an issue for employer contributions

8. 26 August 2015 PIPs and carry forward Pension input periods need not be aligned to tax year Not as simple as looking at what was paid in each tax year Can manipulate PIPs to get extra contributions in for higher earners

9. 26 August 2015 Example of PIP issues DateContributions 5/4/200825,000 5/4/200910,000 6/4/201015,000 1/11/201025,000 5/4/20115,000 Tax Year 2007-2008 =£25,000 2010-2011 £45,000 Calendar year 2009-2010 =10,000 2008-2009 =25,000 2011-12 annual allowance remaining£145,000£120,000 2011-2012 £5,000 2010-2011 =40,000 2008-2009 =£10,000 2009-2010 =£Nil

10. 26 August 2015 Changes to carry forward Pension input periodContributionPreviouslyNew guidance 2008-200925,000+£25,000 2009-201055,000-£5,000Nil 2010-201148,000+£2,000 Amount to carry forward£22,000£27,000

11. 26 August 2015 Reduction in Lifetime allowance Use carry forward before applying for Fixed Protection if possible Tax year counts for Fixed Protection PIP counts for contribution

12. 26 August 201510 January 2012 Fixed Protection

13. 26 August 2015 Reminder about A-day protections Enhanced, Primary and Scheme Specific TFC Lifetime allowance will remain at £1.8m when used to calculate multiples – Primary protection Also remains at £1.8m for Pension Commencement Lump sum calculations Will increase only when LTA increases above the £1.8m Examples in RPSM have recently been updated – be careful they were incorrect

14. 26 August 2015 What is Fixed Protection? Protection from the reduction in the Lifetime allowance Can not apply if you have primary protection, no option to give it up If you have enhanced you must give it up before applying for fixed Protection application deadline 5 April 2012 Not just for those with uncrystallised funds

15. 26 August 2015 Crystallised fund example Bob aged 71, consolidated all pensions into SIPP Crystallises 1.35 Million into Capped Drawdown Uses 75% of the Lifetime allowance, leaves 25% unused Takes PCLS of £337,500 and no income

16. 26 August 2015 What happens at age 75 - no protection Bobs fund had increased from 1.0125 Million (net of PCLS) to 1.45 Million in June 2015 when he reaches 75 BCE 5a – (1.45-1.0125) = £437,500 Remaining lifetime allowance = 25% of 1.5M = £375,000 So excess charge on £62,500

17. 26 August 2015 What happens at age 75 - fixed protection Bobs fund had increased from 1.0125 Million (net of PCLS) to 1.45 Million in June 2015 when he reaches 75 BCE 5a – (1.45-1.0125) = £437,500 Remaining lifetime allowance = 25% of 1.8m=£450,000 No excess charge

18. 26 August 2015 Loss of fixed protection after vesting Fund value of 1.45m in 2011-12 Applies for fixed protection Fund value increases to 1.7m by June 2013 Crystallises 1.44m = 80% of LTA Leaving 20% of LTA (currently £360,000)

19. 26 August 2015 Loss of fixed protection after vesting Contributes on 6 April 2014, Loses Fixed protection informs HMRC 1 June 2014 – crystallises remaining fund of now £400,000 Has remaining LTA of 20% of 1.5m to use = £300,000 Only has LTA charge on £100,000 If he had not applied for fixed only 4% of LTA would remain – LTA charge on £340,000

20. If you clients are not contributing and looking to take benefits soon, why not apply There appear to be no downsides to applying

21. Protected Rights

22. 26 August 201510 January 2012 What is happening 6 th April 2012 – they no longer exist No contracted out rebates to money purchase schemes

23. 26 August 201510 January 2012 We are talking small pots? No! Example: Joined final salary scheme is 1997 Left in 2010 Final salary of £80,000 1/60 th scheme Age 50 Pension at leaving 17,333 pa Estimate of CETV could be £300,000

24. 26 August 201510 January 2012 What this means? Can be used for Flexible Drawdown No restrictions on the type of annuity, if purchased – may be able to purchase larger annuity No death benefit restrictions Less paperwork and reporting requirements

25. Flexible Drawdown

26. Things to remember No contributions in the year you enter flexible drawdown No Annual allowance thereafter MIR must be received in the tax year Proof is required

27. Summary Fixed protection – don’t wait Carry forward – are they missing out? Flexible drawdown – Don’t forget, stop contributions!

28. Contact us T 0870 414 7000 F 0870 414 8000 ifaenquiries@suffolklife.co.uk www.suffolklife.co.uk

29. Suffolk Life is the trading name of Suffolk Life Pensions Limited (registered in England and Wales number 1180742) and Suffolk Life Annuities Limited (registered in England and Wales number 1011674). Both are authorised and regulated by the Financial Services Authority. The registered address of both companies is 153 Princes Street, Ipswich, Suffolk IP1 1QJ. Telephone calls to Suffolk Life are recorded for training, monitoring and fact verification purposes. Suffolk Life provides, operates and administers self-invested personal pensions and similar pension products. Information regarding tax and practice is based on Suffolk Life's understanding at the time this presentation was put together of legislation and HM Revenue and Customs policy. Legislation and HM Revenue and Customs policy and practice may change in the future. This presentation is for adviser use only and is not to be used with clients. Tel: 0870 414 7000 Fax: 0870 414 8000 Web: www.suffolklife.co.uk E-mail: ifaenquiries@suffolklife.co.uk