Frozen Pensions

dirkydel

Need a bit of info regarding the title, I have 3 seperate pensions frozen from previous employers which I will be able to cash in when I'll be 55 in June.

Question 1 - Can I take 25% from each pension tax free?

Question 2 - Can I transfer the balance from each remaining pension into a Fixed term Cash ISA?

Question 3 - Will the balance be taxable as it is transferred?

As I have been told it could be tax free to transfer.

Drp8713

What do you mean by frozen? Are they defined benefit schemes e.g salary related or defined contribution schemes, e.g a personal pension with a Scottish Widows or Standard Life etc for example.


You can take 25% of each tax free, although if its a DB scheme it might not be wise.


No you can't transfer a pension to an ISA. You would have to withdraw the money and it would be taxed as income.


Quite why you would want to take money you don't need yet out of a tax efficient investment wrapper that is a pension, pay tax on it, to then put it in a Cash ISA which will be lucky to even keep up with inflation I have no idea.

dunstonh

I have 3 seperate pensions frozen from previous employers which I will be able to cash in when I'll be 55 in June.

Are you sure you mean frozen. Could they deferred or paid up? Not many schemes get frozen but it is a term frequently mis-used.

Question 1 - Can I take 25% from each pension tax free?

Depends on the type of pension. Occupational schemes or section 32 buy out bonds can have differences and it may not be worth taking the lump sum with some schemes.

Question 2 - Can I transfer the balance from each remaining pension into a Fixed term Cash ISA?

Why would you want to do that? There are not many things you can think of where that would be a sensible thing to do. You cant transfer from pension to ISA. However you can do it as a step of transactions but it would involve tax.

dirkydel

Thanks for the replies.

The Pensions mentioned were 'frozen' as the company decided to change Pension Provider, so there's no money being paid in and I only accrue the yearly benefits on it, if any.

1 Standard Life

2 Equitable Life

3 Aviva

These are not huge pensions, between the three we're only looking at around £28,000

dunstonh

None of those pensions are frozen. Frozen is a specific term with a meaning and consequence and those cannot be frozen.

xylophone

They are not frozen- they are investment based and will go up/down with the market.

You might wish to have a look at https://www.pensionwise.gov.uk/?gclid=CK34g5fu88QCFQjKtAodFigAiA

Re state pension https://www.gov.uk/state-pension/overview

woolly_wombat

dirkydel wrote: »

Thanks for the replies.

The Pensions mentioned were 'frozen' as the company decided to change Pension Provider, so there's no money being paid in and I only accrue the yearly benefits on it, if any.

1 Standard Life

2 Equitable Life

3 Aviva

These are not huge pensions, between the three we're only looking at around £28,000

Check carefully for any guarantees, which could be invalidated by early access. Is the Equitable Life pension with-profits? If so then it could contain a valuable GIR (guaranteed investment return) which is only applied from age 60, and then only if you go into immediate drawdown or retirement with an annuity.

WW