Can I cash in my pension?

amiaspden

Upcoming BBC program: "Simon Cox investigates the dangers of 'pension liberation' schemes in which people under 55 are told they can release money from old pensions without paying tax."
8pm 21st March, Radio 4.
iPlayer page http://www.bbc.co.uk/iplayer/episode/b01r9sw4/The_Report_Pension_Liberation_Schemes/

atush

Thank God. Or maybe the BBC?

About time someone in TV starts talking about this. I have read about it in (only) broadsheet newspapers but not yet seen it mentioned on TV (where those most likely to succumb may be found I think?).

Proxy

Summary of that programme from BBC.co.uk

http://www.bbc.co.uk/news/business-21844955

'll end up with no pensions. I've had the most traumatic six months of my life and I've ended up with a whacking great bill from Inland Revenue”

Take heed, people.

molerat

As a trained accountant, Mr Zanetti was aware he would have to pay tax on the release of his pension but he did not realise it would be £11,000. He has not yet received any money.

Glad he was not my accountant !

That article should be made compulsory reading.

clydefreeman

Yes, you can cash your pension. You have the option to cash out but be sure to planned it well. Either you start your own business to make your money grow.

Aegis

clydefreeman wrote: »

Yes, you can cash your pension. You have the option to cash out but be sure to planned it well. Either you start your own business to make your money grow.

This is almost always not true. Any person whose pension savings exceed the triviality amount (£18,000) cannot simply cash in their pension savings other than a maximum of two stranded pots of £2,000 or less over their entire lifetime.

The only times a pension can fully be commuted to cash where the benefits exceed the terms above are where the scheme has protected Tax Free Cash of 100% of the value of the policy or when the policyholder has been diagnosed with a year or less to live.

jamesd

You can also extract all of the money with flexible drawdown provided you have at least £20,000 of income a year for life, counting only things such as work final salary pensions, annuities and the state pensions, all of which must be in payment at the time.

dunstonh

clydefreeman wrote: »

Yes, you can cash your pension. You have the option to cash out but be sure to planned it well. Either you start your own business to make your money grow.

No you cannot.

Apart from death, triviality or short service (on defined benefit schemes) or schemes with transitional protections (from rule changes in 2006) which allow greater than 25% tax free cash you cannot get cash in a pension (not that any other those are actually cashing in the pension).

bruceingram1958

The answer is yes. But be aware that you are going to pay taxes as well as penalty. However, if you wait until your retirement comes, you will get 100% back. Anyway, if you really need cash, you can always take a loan.

dunstonh

bruceingram1958 wrote: »

The answer is yes. But be aware that you are going to pay taxes as well as penalty. However, if you wait until your retirement comes, you will get 100% back. Anyway, if you really need cash, you can always take a loan.

THis is a UK site. Not US. The answer is no.