Aged 55 and 25% tax free

Dalglish

I’ve got four pensions from different employers over my career and I’d like to know is there a way to draw 25% tax free once I turn 55?
I’m unsure if I have to write to each or is there a standard form or money saving expert template letter I could use?
Would I be advised to use an IFA for this purpose?
Many thanks in anticipation 😊

Linton

No standard form. You will need to contact each one ndividually. I can't see much point in using an IFA except that he may ask you the question "why?". What are you going to do with the money? There may be better ways of managing things.

kidmugsy

Dalglish wrote: »

I’ve got four pensions from different employers over my career and I’d like to know is there a way to draw 25% tax free once I turn 55?

Are any of them Final Salary pensions?

Dalglish

Hi both ... no final salary (as far as I know) ...
Earliest dates from 1990-1993 but almost certain it’s a money purchase scheme.
Nothing definitely planned what to do with the money ... I’ll see what the companies say

Alexland

In which case have you considered leaving it invested and just drawing out an extra 25% tax free each month when you start taking your pension payments? For some people can be an effective way of avoiding paying any income tax in retirement. By taking the cash in lump sums you are making it part of your estate for inheritance tax.

dunstonh

The transaction you are requesting is called income drawdown. It will be taking the 25% and zero income.

Whilst most modern plans retail pensions will allow income drawdown, you will find most legacy pensions (old ones) will not. Stakeholders dont usually nor do most auto-enrolment schemes or occupational pensions.

Companies may only tell you what options they have. Not all the options available. So, be careful on the info you get and remember it will not cover everything.