Can't take Pension Lump Sum. Is this right?

100

Filled out all the forms to take a small pension (under £15k pension pot) as a lump sum.

Phone call today to say that the Pension Trustees will not allow people to access their money like this and I need to purchase an annuity.

Can anyone throw any light on this please. This is not how it is supposed to happen surely?

Many thanks for any assistance. Is there anyone I should contact regarding this please?

xylophone

You speak of the Trustees - is this a defined benefit occupational pension?

100

If you mean was it a final salary scheme? No. It was an annuity scheme? At least that's what I thought it was. I don't really understand the jargon sorry. Money Purchase scheme?

kidmugsy

If it's money purchase, then all you need to do is transfer to a provider who does allow it. First you'd be wise to check that you would not be giving up any desirable features, such as a GAR (guaranteed annuity rate).

100

I've checked the GAR and I'm only entitled to the minimum 25% tax free amount. Is transferring difficult and could I expect the Pension Provider to help me with this please? Thanks for your help.

I don't think GAR is what I mean, I think it was the protected amount that I was referring to.

kidmugsy

I've found transferring very simple. You put it into the hands of the destination provider, they ask you to sign a form, and then it happens - pretty swiftly in my experience.

The best for service is Hargreaves Lansdown, and their charges are very decent as long as you leave the money with them for a year (or, at least, leave £1k with them). I think people here have recommended Virgin if your purpose is to take the lot out promptly. Anyway, you'll want to check the charges yourself.

xylophone

I think it was the protected amount that I was referring to.

I am not sure that any of us quite understand what is happening here.

Would you be willing to provide more details of your pension scheme?

xylophone

There's also this https://www.pensionwise.gov.uk/

100

xylophone wrote: »

I am not sure that any of us quite understand what is happening here.

Would you be willing to provide more details of your pension scheme?

Hi, Sorry, I don't understand the correct terms with pensions but when the GAR was mentioned, I had it in my head that it was the "Protected pre 6th April 2006 tax free cash entitlement" which it wasn't. I don't know if I do have any GAR.

I need to phone the company again tomorrow and try to find out.

It all came as a shock today and my thinking just isn't straight. The company has been sending me forms and forecasts over the past couple of years and only now do they say I can't take it out as a lump sum. I'm very upset by this.

It's a Prudential pension and now I have just found out it is managed by trustees who wont consent to the lump sum withdrawal.

kidmugsy

Is it an AVC? (additional voluntary contribution)

xylophone

Are you still working for the company in whose scheme you built up the benefits?