Our personal pension, the Collective Retirement Account (CRA), is a Defaqto ‘5 Star’ service rated pension scheme provided by Quilter Life & Pensions Limited.
The CRA offers some of the most comprehensive withdrawal solutions in the market. This includes automated monthly income options that let a client take money out of their pension using only tax-free cash, or a combination of tax-free cash and taxable income. These options are designed so that you can tailor each CRA to meet your clients’ needs, help continue to grow their pensions, be more tax-efficient and maximise their legacy if required.
The following features are available:
- The CRA has been updated from a single account that can contain both uncrystallised and crystallised pension money, to a multiple, sub account model where uncrystallised and crystallised pension monies are held in separate sub accounts. This structure allows:
- Separate asset allocations for uncrystallised and crystallised savings – Flexi-access drawdown and capped drawdown within the same client account.
- Exchange Traded Funds (ETFs), Exchange Traded Commodities (ETCs) and Investment Trusts
- Cash functionality
- Re-registration functionality
- Direct Debit collections and regular withdrawals can be paid on any date from 1st – 28th of the month
- Voluntary ‘scheme pays’ allowing customers to settle annual allowance tax charges for any pension scheme. Once established by the client, the CRA will pay HMRC as soon as possible after a request is received, minimising the risk of any late payment penalties associated with other options in the market
- The maximum age for all transfers (including uncrystallised) will be 85.
Nine flexible ways of withdrawing money from the CRA, all at no additional charge:
- Flexi-access drawdown options (FAD)
- Capped drawdown
- Lump sums from uncrystallised funds through FAD
- Small pots – Up to £30,000 can be taken as small lump sums from Collective Retirement Accounts which are uncrystallised. 25% of each payment will be tax-free with the balance taxed at the basic rate of income tax if we don’t already hold a tax code. A small pots payment can also be made from a fully crystallised account with a value of £10,000 or less, in which case the whole amount is subject to income tax. If we don’t already hold a tax code we will use an emergency month 1 tax code. Any higher or additional rate tax will be collected via the member’s annual tax return. Three tax-efficient* regular income options:
- Monthly payment is all tax-free – We pay 25% of the amount crystallised as a tax-free lump sum. The residual crystallised amount is moved to the crystallised drawdown pot for future taxable income withdrawals;
- Monthly payment is a mix of tax-free and specified taxable amounts – We pay 25% of the amount crystallised as a tax-free lump sum and a specified part of the residual crystallised amount as taxable income. The balance will be moved to the crystallised drawdown pot for future taxable income withdrawals;
- Monthly payment is 25/75% mix of tax-free and residual taxable amounts – We pay 25% of the amount crystallised as a tax-free lump sum and the residual crystallised amount as taxable income The above regular income options can be set up alongside existing flexi-access income withdrawals
* The tax treatment and efficiency of these options will depend on the individual circumstances of each client. Tax rules and their application may change in the future. - Open market option
- Legacy planning death benefit options