DB pension - if you DON’T take TFLS, do the annual payments have a 25% tax free component?

MeteredOut

With my DB scheme, the max PCLS is almost exactly 25% of the sum of that amount and the annual pension at a 20x commutation rate. I've just ran the retirement illustrator this over multiple retirement years and they are all within £2.

(this assumes the pension providers retirement illustrator is correct, of course)

snowlaser

DB pension payments are always subject to income tax.   If you don't take the tax-free PCLS there is no opportunity to get anything tax-free later.

Note that this does NOT mean you should therefore just blindly take the PCLS to save on tax - you need to think about your own life expectancy, patterns of expenditure, the commutation terms on offer etc