I have taken my 25% PCLS (Pension Commencement Lump Sum) from my SIPP, and as expected, received the amount tax free. I am not registered for self assessment, and my income in 2022/23 is below my tax allowance.
Question: Do I need to report the PCLS to HMRC and if I do when and how?
I wish to know if a payment proposed by my IFA is taxable.
Due to market volatility I arranged for investments in my Retirement Investment Account (SIPP) to be taken out of the market and held in cash. I subsequently agreed with my IFA to commence drawdown, but keep me out of the markets and for the immediate future still hold in cash. Due to an error I was incorrectly placed back in the market for a few days. Prompt corrective action was taken but this still resulted in me losing circa £1500 from my cash account. The IFA cannot put money back into the RIA and wishes to make a direct payment to me. This payment will place me back in the same situation as if the error had not been made. The proposed payment does not include any interest.
Question: Given the circumstances, does HMRC regard this payment of £1500 as taxable?