Sound financial planning is not just about building up your assets in the most tax-efficient way.

To avoid an unnecessary tax bill, it can be just as important to consider how and when you withdraw your money. Health and safety consultant Peter Sims saved around £50,000 in tax on the advice of his financial planner, James Etheridge, director of Focused Financial. The 77-year-old from Chatham, Kent, is still not ready to retire, but has started taking some money from his various pension pots to enjoy life and pay for memorable experiences.

Peter had been caring for his mother until she died last year at the age of 107, so when he’s not working, he spends as much time as possible travelling to far-flung destinations with his partner Sheila, aged 62. They have already visited the Galapagos Islands and Ecuador, and taken a trip on the Trans-Siberian Express. Following James’ advice, Peter dipped into his savings so he didn’t need to draw earnings from his business last year. This meant he could bring his Income Tax rate down to zero for a year, which enabled him to take a six-figure sum from his deferred State Pension pot without being taxed. Without James’ help, he would have been taxed at his normal income rate, which would have meant paying at least 40 per cent. “I was much happier to keep it myself than to hand it over to the government,” says Peter. “We like our holidays, so I wanted to make sure there was enough money in the pot to carry on for a long time. I hope to match my mother’s age.”