Final Bonus for With-Profit Fund Investment

1970Amanda

Looking to drawdown on one of my old pension policies (Aviva defined contribution) and take the 25% tax free amount leaving the remainder invested. 

On the last statement I received, the plan value was £77,359.75 (Fund value £51,739.62 and final bonus for with-profit fund investment £25,620.13).

I'm confused about the bonus and whether I would lose this. Is the bonus included in the calculations when drawing down? What would the tax free amount be on that policy?

Thanks for any help.

dunstonh

The final bonus accrues daily (it can go down as well as up).    Despite its name, it is not added on at the end.

I'm confused about the bonus and whether I would lose this. Is the bonus included in the calculations when drawing down? What would the tax free amount be on that policy?

Most plans that are with profits investments do not offer drawdown functionality or offer only limited options (most typically UFPLS only).   So, it is statistically likely that you will have to transfer the pension.

However, whatever the transfer value is on the given day of transfer (or withdrawal if they do offer UFPLS), that is what you get.