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Topic: Money Purchase Annual Allowance MPAA  (Read 1050 times)

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Money Purchase Annual Allowance MPAA
« on: February 10, 2023, 01:48:48 PM »
Does the Money Purchase Annual Allowance apply to if someone would contribute to a USA defined contribution scheme?  That is to say, would they be only allowed to contribute up to 4,000 GBP/year to a USA defined contribution scheme.

This situation would apply to a US citizen who currently resides in the USA.
« Last Edit: February 10, 2023, 02:29:10 PM by frank1234 »


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Re: Money Purchase Annual Allowance MPAA
« Reply #1 on: February 10, 2023, 03:00:53 PM »
Not even heard of this before, but then I'm retired and haven't made any contributions to a pension plan in over 10 years.  It looks to be fairly specific, in that it applies to folks who are taking money out of a pension pot while making contributions to a different pension pot and looking to get UK tax relief at the same time.

https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/money-purchase-annual-allowance-mpaa

Quote
If you start to take money from a defined contribution pension pot, the amount that can be contributed to your defined contribution pensions while still getting tax relief on might reduce. This is known as the Money Purchase Annual Allowance or MPAA.

Given the added situation below then I don't see that MPAA would apply.

This situation would apply to a US citizen who currently resides in the USA.
« Last Edit: February 10, 2023, 03:04:44 PM by durhamlad »
Dual USC/UKC living in the UK since May 2016


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Re: Money Purchase Annual Allowance MPAA
« Reply #2 on: February 11, 2023, 08:58:56 AM »
If it was a QROPS, then yes MPAA rules apply. Although this would be depended on the withdrawal strategy of the pension trigger.


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