Aj Bell Platinum Sipp · CAS-29013-D0P2

CAS-29013-D0P2

Ombudsman’s Determination Applicant Mrs S

Scheme AJ Bell Platinum SIPP (the SIPP)

Respondent AJ Bell

Outcome

Complaint summary

Background information, including submissions from the parties

“Can you confirm based on the SIPP valuation how much cash can be drawn to complete the 25% tax free draw down. I previously withdrew £140,000. I am selling one of the properties and want to understand my tax free options on withdrawing cash.”

“As at 15 July 2017 the crystallised / uncrystallised split of your SIPP is as follows:

Uncrystallised - £146,257.05

Crystallised - £415,329.07

Please note that the above figures are a rough guide.

1 CAS-29013-D0P2 The current balance of the SIPP cash account is £2,586.85. Should you decide to crystallise further funds held within your SIPP, you will need to ensure that cash is available to pay the tax free cash.”

“Please find attached a copy of last year’s accounts of [sic] which the figures are based on.

The year-end date for your SIPP is approaching (15 July) of [sic] which we will be obtaining a full value of the SIPP and completing a fund split calculation to determine the split between crystallised and un-crystallised funds.

I have had a quick look at the values that we currently hold for the assets of your SIPP and confirm the following approximate figures:

Uncrystallised - £183,835.24

Crystallised - £522,040.61

Total: £705,875.85

Please note that the above figures are a rough guide.”

before I chrytalised [sic] there was surplus cash of £146.000

So if [sic] want to know the 25% value isn’t it based on those above figures and then I deduct the amount already taken?”

2 CAS-29013-D0P2 “On 10th December I am selling one of the properties and will take a cash draw down from the fund.

The property will he [sic] sold at £330,000 and I wish to take out £80,000 as soon as possible. In preparation can you please confirm the process and provide the relevant documents to me by email please.”

“Please find attached our sales letter detailing our general requirements for the sale of the property.

Please could you confirm which property you are planning to sell and whether you have found a buyer or are just marketing the property?

Once I have a better understanding of the proposed sale I will be checking our rent reconciliation records for any rental arrears due on the property.

Furthermore, I would be grateful if you could please forward the details of your appointed solicitor so that I can contact them with our requirements.”

“My understanding is that you wish to withdraw a tax free cash lump sum once your property has been sold.

To access these benefits, we will require you to complete the attached benefit form & return this to us in the post.”

“Can I confirm the following please

There should be funds available in the SIPP account on 12th December

You should receive this signed document on Monday 10th

I will need to have a same day transfer into my account with available funds on 13th December

Can you confirm this is ok please?

I am in India and can only post the original to you on Friday and hence no delivery to you until Monday.

I will scan the original for your review tomorrow. Please confirm dates as I am making a purchases [sic] and need the funds no later than the 13th.

3 CAS-29013-D0P2 You can see from this email chain, I sent the original request over 2 weeks before receiving this form and as such am experiencing tight deadlines.”

“Please could you confirm your requirements.

I have seen that you would like to withdraw £80,000 from your SIPP, however would you like to take this with tax free cash or purely as taxable income?

If you require the funds as only taxable income we will not require a form to be completed, once the cash is available you would simply need to send an email stating how much you require as taxable income and that you require it via same day transfer (CHAPS) and we will send the funds.

However if you do require part of the payment as tax free cash you would need to complete and return the form my college [sic] previously sent to you.

The issue with this would be your time constraints, our usual timescales for tax free cash are 5 to 10 working days from the date we receive all outstanding information including any documents, original forms, transfers or valuations.

Therefore if you do require the payment as tax free cash I cannot guarantee we will be able to make payment by the 13th if we receive your form on the 10th.

Please confirm which you require.”

“Client called to confirm she could get her payment in time for a property purchase on Friday.

I explained that she had asked for a pcls payment and explained the timescales. She said she would take an income payment if this meant she would get her cash.

4 CAS-29013-D0P2 I told her that I could not guarantee that she would be paid straight away but that we would do our upmost [sic] as long as there was cash available to make the payment.

She told me she would be calling for an income payment on Friday for around £75,000 and she believes that the cash from her property sale will be in the account.

She told me that she would also like a crystallisation of £200,000 in order to receive £50,000 in tax free cash. This will be completed separately.”

“We now understand that you wish to withdraw a tax free cash lump sum of £50,000, thank you for confirming this. Please note that this may not be achievable due to your uncrystallised value of your SIPP being worth approximately £152,696.02. Once we have received the outstanding property valuation & calculated the benefits available we will be in a position to confirm the amount of tax free cash available to you. Based on this, can you confirm if you would prefer to fully crystallise your SIPP which will provide you with the maximum tax free cash available?

In regards to withdrawing taxable income payments, this can be done via email. You will simply need to confirm to us the amount you wish to be paid as well as whether you wish for the payment to be sent by BACS or CHAPS (CHAPS will incur an additional fee of £25 +VAT). We always aim to release these payments within 3 working days from when the request is received. You may also request a net amount in your request for taxable income.

The gross payment will be £68,778.60 as shown below (granted the funds credit the account before the 6 January)”.

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“[Mrs S] rang up in desperate need for funds on Monday. She has been going through a PCLS application and this is taking longer than first thought. She requires a £50,000 NET payment (£68,778.6 gross) on 17/12/2018 via CHAPS for a property purchase. She has no bank details on our systems so I took her through verification which she passed. Informed her she would need to request the payment via CHAPS if it were to go same day. She will send in an email outlining her requirements. Informed her that the cash will need to reach the [SIPP] account before payment cut off on Monday if we were to make the payment that day.”

“This email is specifically to arrange a taxable income payment to be made on Monday 17th.

On this day the sale proceeds will be deposited from [Property 1]. Approximately £328,000.

I require a CHAPS NET payment of £100,000 to be paid to my validated bank account….

…On receipt of this email can you please confirm this payment will be made subject to the funds being available in the account.

Please note the deposit needs to be in my account on the 117th [sic] and must be made as a faster payment please confirm” [original emphasis].

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“Hello I’m really concerned

You have paid me a tax free amount but I didn’t want this as I had to take the income payment because you had made errors.

To be clear my original plan was to take £100000 [sic] income and a tax free payment of £40,000

Instead I had to take £140,000 as income and had to pay £100,000 tax. Only due to your errors.

I am claiming the £50,000 tax from you as compensation for your error.

You have now paid me £27,000 for what? Is this compensation or the original tax free request.

I am depleting my pension through your lack of process.

Can you confirm.

7  CAS-29013-D0P2 1. What the payment you made to me is for

2. If it is not compensation what is the status of my complaint

3. If it is a tax free sum please send me the calculations

4. Confirm I can send this payment back to my SIPP

5. Confirm where my SARS request is

This is urgent as I cannot make any investment activity on my SIPP until you sort this out.”

A summary of Mrs S’ position

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A summary of AJ Bell’s position

Adjudicator’s Opinion

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Mrs S did not accept the Adjudicator’s Opinion and the complaint was passed to me to consider. Mrs S provided her further comments which do not change the outcome. I agree with the Adjudicator’s Opinion and note the additional points raised by Mrs S.

Ombudsman’s decision

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I do not uphold Mrs S’ complaint. Mrs S should contact AJ Bell directly if she wants to accept its offer.

Anthony Arter

Pensions Ombudsman 01 March 2021

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