Tax question on SIPP encashment

Hi, I am 56 and recently unemployed for the first time. I was considering 100% encashment of my SIPP (not my only pension) as I cannot claim Job Seekers allowance past the end of July and cannot claim other benefits. I understand that the first 25% is tax free, but that the remaining 75% will be taxed. As I am unemployed, will my personal tax free allowance come into play, before then being taxed on the remaining funds? I have a feeling that money will do better in an ISA as I haven’t used this years allowance yet..

Hi,

We cannot advise you how to utilise your pension. The taxable part of your pension lump sum will be calculated and deducted by the pension provider. You would then need to claim a refund from HMRC, for any tax overpaid.

Thank you.