Tax free lump sum

Replican

I am now at an age (56)w I can access the 25% tax free lump sum. I have 2 frozen DB pensions and my current pension is a DC one. I have had figures off one of my frozen pensions which would give me a lump sum of £21,000 and just over £3k a year. My question is. Would it be worth taking the pension and putting the lump sum into my current pension. I understand that the government add 25% in tax top up. I would then use the monthly pension to clear my mortgage early.

Dox

Replican said:

I am now at an age (56)w I can access the 25% tax free lump sum. I have 2 frozen DB pensions and my current pension is a DC one. I have had figures off one of my frozen pensions which would give me a lump sum of £21,000 and just over £3k a year. My question is. Would it be worth taking the pension and putting the lump sum into my current pension. I understand that the government add 25% in tax top up. I would then use the monthly pension to clear my mortgage early.

Your DB pensions aren't 'frozen' - they are continuing to revalue (i.e. increase) between the time you left the schemes and the time you access your benefits from them.

Your plan would fall foul of the pension recycling rules, explained here: https://www.pensionsadvisoryservice.org.uk/about-pensions/saving-into-a-pension/pensions-and-tax/pension-lump-sum-recycling

Albermarle

Also by taking a DB pension early then of course you get a significantly smaller annual pension ( and lump sum ).
Some pensions reduce the pension more than others for each year early you take it . So if you do intend to take one early then make sure you have all the facts , as it maybe better to take one rather than the other. 
You will realise of course that as you are still working the income from the DB pension will be taxed at your usual tax rate. 

Malthusian

Assuming 56 isn't the normal retirement age, you are proposing to cash in an investment which is so good that most people aren't allowed to own one, paying a penalty to do so, and reinvesting in something which will probably fail to beat inflation (assuming you are on a standard low mortgage rate). You are probably paying unnecessary income tax as well. In the absence of more information it's sounding like a loser.