Flow diagram

Here’s the accounts that we showed before plus:
• some extra movements.
• dotted lines and stars to show orange where lifetime allowance is used up, and red where income tax applies.
• a few numbers to help show how a particular flow splits or is taxed.

Note the loop at the top. If you have money in your current account at some time in your life, you can increase it as it goes into a SIPP, and then later as a pension receive more out than you put in … maybe.

A 20% taxpayer who pays 0% for a while in retirement can turn £80 into £100 (25% extra).

A 40% taxpayer who pays 20% in retirement can turn £60 into £85 (almost 42% extra).

But a 20% taxpayer who takes it as a pension when they have state and another pension might be taxed at 20%, so they turn £80 into £80.

At some times, student loan 9% or child benefit taper might mean you need to use different percentages.
And remember that the LTA adds a further level of complexity to this choice.