Wasn't warned about this catch.

[Regular.Cyclist]

NHS worker here who’s already drawing a private pension, and pay handsomely in tax on it.

Planning on retiring in a little over three years when I will take the ‘95 scheme part and of the NHS pension, sometime later I’ll draw the CARE scheme part and the state pension unless I get robbed of that before then.

Under no illusion that I am likely to hit the higher tax bracket (especially as it’s lower in Scotland than England) so that has been calculated into my future income.

 

[teeonethousand]

When I reached 65, I decided to carry on working as I was enjoying what I was getting paid for and the extra five years I did would enhance my state pension.
However, after a couple of 'unpaid tax' demands form the HMRC this year, it transpires that my state pension 'extra amount' has put me rather above the personal allowance limit, so now I'm getting charged tax on the extra pension I worked another five years for - !
Apparently it's termed 'fiscal drag' because the persona allowance rate isn't keeping up with the increase in state pension.
I shall be 'phoning HMRC tomorrow to see if there's a way they can alter the tax rate on my pension bit so we both don't have to waste time & effort in making the calculations.

There is no catch ..you did a smart move.

If you had taken it at 65 and were still working it would have counted as income and would consume your then tax allowance and so you would have paid more tax. Depending on your earnings you might have been pushed (further) into higher rate.

Also, by not taking it you probably benefitted from higher growth .

 

[Moderators]

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