Delay in releasing tax free lump sums and income instalments

 

Mr D A Cheshire

71 Oakley Street

Coventry

CV2 8LG

 

5^th April 2010

 

Dear Sir / Madam,

 

On 4th September 2006 I was paid a tax-free lump sum of £170,225 by Company X which was the proceeds from a pension transfer value of £680,900. However I did not receive my first income instalment of £22,108 (two quarters worth of income) until 20^th October 2006. 

 

I have recently been informed that my tax-free lump sum should have been calculated on the 17^th June 2006 however it was delayed without my knowledge. Had no undue delay occurred I now know that I would have received a lower transfer value of £674,000, which would have resulted in a lower tax-free cash sum of £168,500 rather than the £170,225 I received.

 

I also believe that I should have received my income payment of £10,942 on 17/06/06 and then again on 17/09/06.

 

I look forward to your response.

 

Dominic Cheshire

 

Please note: In this scenario, interest should be added using the Bank of England Base Rate.

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