Crystallising a SIPP on the Soderberg platform can be done in one of two ways, via UFPLS or FAD.
UFPLS
With UFPLS, the client receives one payment that consists of PCLS and income and the funds in question are sent straight from the Accumulation SIPP account in question.
The UFPLS payment will be received on one of the discrete payment dates, 7th, 14th, 21st or 28th of the month and a payslip will be made available on the same day.
FAD
With FAD, the process is different. The client will receive a PCLS payment which is sent off of the platform by BACs which take 3-5 working days. Where a sell-down is required, this will be extended by a further 4 or 5 working days and so can take up to 10 working days to receive a PCLS payment.
The remaining crystallisation balance that is taxable, is moved into the client’s drawdown account and if a withdrawal has been instructed as a part of the crystallisation, it will be paid out from the drawdown account in question.
Income payments are paid out on discrete payment dates of 7th, 14th, 21st or 28th of the month and a payslip will be made available on the same day.
Whether it’s an income payment or an UFPLS payment, the instruction has to be setup at least 7 working days before the payment date in question for the payment to be sent in the desired month.
Crystallising via FAD with an income withdrawal
Where there is sufficient uninvested cash to fund PCLS and the withdrawal, assets are moved into Drawdown as cash first and then in-specie afterward to fund the remaining FAD transfer amount, (as the client may only want to take a portion of the taxable money as income and leave the rest in drawdown).
However, if there is insufficient cash to fund PCLS and the withdrawal, the system will proportionately move assets across into drawdown in-specie to fund the entire FAD transfer amount, (i.e. 75% of the crystallised value), and only use cash as a balancing item if required.
Crystallising via FAD without an income withdrawal
The system will proportionately move assets across in-specie to fund the entire FAD transfer amount, (i.e. 75% of the crystallised value), and only use cash as a balancing item if required.