Government retirement rules before 55

wannaberetiree

Can anyone help me understand the governments rule on the gov uk site please, it says:

When you get your personal or workplace pension
When you can take money from your pension pot will depend on your pension scheme’s rules, but it’s usually after you’re 55.
You may be able to take money out before this age if either:
you’re retiring early because of ill health
you had the right under the scheme you joined before 6 April 2006 to take your pension before you’re 55 – ask your pension provider if you’re not sure
Some companies offer to help you get money out of your pension before you’re 55. This could be an unauthorised payment and you’d pay up to 55% tax on it.

My pension plan quite clearly states in my original policy booklet/document, and several other documents, that I can take my pension from aged 50. I took my pension out in 1987, so prior to the 6 April 2006 as stated above. My pension provider says that I have misunderstood the Government Guidelines and that it is now LAW that a right to your pension under 55 is only for certain types of occupations such as armed forces, police and does apply to me.

They also said that if I tried to get my pension early it will come under the unauthorised payment section and I will be breaking the law and will be subject to a hefty tax fee.

I cannot find any further information on the Gov UK website which states/explains that only certain occupations are eligible to take their pensions earlier than 55 yrs. Every link I take keeps sending me back to the above statement. Nowhere can I see that the Government Guidelines say that only certain occupations can take their pension early if their original policy was taken out prior to 2006 and the original policy said they could take it at 50 yrs - it just says 'you can take it if you had the right to under your scheme'. (I am now 51, I have been arguing the point on several occasions since 50).

There doesn't seem to be an email on the Gov UK website otherwise I would have written direct to them.

My pension people off er no advice other than I am not entitled to take it until 55 yrs and if I did find a way round it I should be very careful as I would be breaking the law and would be subject to extra tax fees.

Can anyone offer any advice please, or point me in the right direction to understand who can take their pension early.

jem16

wannaberetiree wrote: »

Can anyone offer any advice please, or point me in the right direction to understand who can take their pension early.

very few people can take it before age 55 and in most cases, as you have been told, it's certain occupations and certain circumstances.

This might help explain;

http://www.scottishwidows.co.uk/Extranet/Literature/Doc/FP0342

and;

http://www.hmrc.gov.uk/manuals/rpsmmanual/RPSM03106035.htm

dunstonh

Government retirement rules before 55

There are no rules on retirement. Just rules on when you can commence a pension.

My pension plan quite clearly states in my original policy booklet/document, and several other documents, that I can take my pension from aged 50. I took my pension out in 1987, so prior to the 6 April 2006 as stated above. My pension provider says that I have misunderstood the Government Guidelines and that it is now LAW that a right to your pension under 55 is only for certain types of occupations such as armed forces, police and does apply to me.

Legislation changes trump contracts. So, whilst it was 50 when you started in 1987, the legislation changed in 2006 raising it to 55.

Bar a few protected schemes, some unusual hybrid schemes and some short career roles it will be 55 for the vast majority.

wannaberetiree

Thank you very much for the information.

I still don't understand why it doesn't put this on the government website, in that it only applies to certain occupations because it has nothing really to do with what your original policy states. Also, I would really like to argue the point with the government that they shouldn't be able to overrule a private agreement I, or anyone else for that matter, had with a non government body.

Also, I wonder whether you work for a pension provider, if so, do you know if all pension providers should have informed policy holders of the new terms and sent them new policy documents?

Goldiegirl

dunstonh wrote: »

Bar a few protected schemes, some unusual hybrid schemes and some short career roles it will be 55 for the vast majority.

My pension scheme must have been one of the protected ones.

Some years ago, we had a letter confirming that we retained the right to take our pension at 50.

As it turned out, that was exactly what I did, when I was made redundant, as an attractive offer was made on the pension as part of the redundancy package.

I'm not in the forces or the police or anything like that.

I know I was lucky that my scheme was a protected one. I don't know what the criteria was for protection, but it was a very large scheme.

It would have been helpful if the OP's scheme administrators had written to the employees to advise them that they couldn't take a pension until the age of 55. But there's no way round it - if the scheme doesn't allow it due to the changes in legislation, then you can't take your pension before age 55

hugheskevi

I still don't understand why it doesn't put this on the government website

Everything you want to know should be at http://www.hmrc.gov.uk/manuals/rpsmmanual/RPSM03106000.htm

The main Gov.uk pages tend to be too simple to have any useful information.

wannaberetiree

Whilst I understand what you are saying, don't you think that the government website should actually provide full and correct details on its site ie. it should say this only applies to certain occupations.

This pension I am referring to is not my main pension it a small personal pension - no attachment to any occupation/job, I took this out myself separately to my workplace and which I haven't paid into for 25 yrs.

I suppose I don't have much confidence in the pension provider because they came under the miss selling of pensions thing about 15 years ago and had to compensate me, although in their favour they did actually contact me about that rather than me chasing them.

zagfles

wannaberetiree wrote: »

Whilst I understand what you are saying, don't you think that the government website should actually provide full and correct details on its site ie. it should say this only applies to certain occupations.

It doesn't just apply to certain occuptions. It also applies to certain schemes depending what it says in their rules, and if you're a member of one of those schemes it doesn't matter what your occuption is. See the link above.

This pension I am referring to is not my main pension it a small personal pension - no attachment to any occupation/job, I took this out myself separately to my workplace and which I haven't paid into for 25 yrs.

I suppose I don't have much confidence in the pension provider because they came under the miss selling of pensions thing about 15 years ago and had to compensate me, although in their favour they did actually contact me about that rather than me chasing them.

The pension booklet might have said 50, but it might also have said you get your state pension at 60/65. That would likely just have been a summary of the rules at the time it was published, and it probably said somewhere they're based on current legislation or words to that effect.

dunstonh

Whilst I understand what you are saying, don't you think that the government website should actually provide full and correct details on its site ie. it should say this only applies to certain occupations.

The pensions manual for advisers is very thick. A webpage for consumers has to simple and short. Martin has said similar about guides on this website too. They cater for a majority but not a minority.

I suppose I don't have much confidence in the pension provider because they came under the miss selling of pensions thing about 15 years ago and had to compensate me,

Pension misselling occurred between 1988 and 1993/4. Not 15 years ago. Its a very different world nowadays. However, even back then, the pension was not mis-sold through malice. They were caught up with actuaries and guidelines that were right at the time but with hindsight were wrong.

zagfles

dunstonh wrote: »

Pension misselling occurred between 1988 and 1993/4. Not 15 years ago. Its a very different world nowadays. However, even back then, the pension was not mis-sold through malice. They were caught up with actuaries and guidelines that were right at the time but with hindsight were wrong.

Yes, nothing whatsoever to do with the commission of the first year or two's premiums which the adviser or their firm typically got

SnowMan

dunstonh wrote: »

Pension misselling occurred between 1988 and 1993/4. Not 15 years ago. Its a very different world nowadays. However, even back then, the pension was not mis-sold through malice. They were caught up with actuaries and guidelines that were right at the time but with hindsight were wrong.

There was nothing remotely OK about people being advised to opt-out, not join or transfer out of good defined benefit pension schemes, and suffering very large losses as a result.

It was an absolute disgrace what went on.

It was very much commission driven selling. Not a thought was given for the people who were losing out.