Tax free lump sum x 2?

comfortablynumb_3

Hi,
Hoping that someone can help with my query.
As I am over 50 I am currently in the process of claiming a 25% tax free lump sum from a paid up contracted out Personal Pension with Abbey Life and probably taking the Open Market Option with the balance.
However, I also have a Scottish Widows Group Money Purchase Plan with my employer and I was wondering if it was possible to also take 25% from this at the same time. I suppose the question really is do all types of pension plans now allow this tax free lump sum at 50?
I have searched online and on this forum but just can't seem to get the exact answer to the question. I should add that I will be meeting with the Group Pensions Manager next week but my impatience is getting the better of me.
Many thanks.

EdInvestor

comfortablynumb wrote: »

Hi,
However, I also have a Scottish Widows Group Money Purchase Plan with my employer and I was wondering if it was possible to also take 25% from this at the same time. I suppose the question really is do all types of pension plans now allow this tax free lump sum at 50?

In theory they do, but many pensions will have scheme rules which in effect disallow it.One such rule might be that you can't "take benefits" (for that is what you are doing, another word is "crystallizing") from a pension which is part of an ongoing group scheme into which you and your employer are paying contributions.

It might be possible to close your existing GPP plan, so as to take benefits from it,while simultaneously opening a new GPP plan to receive ongoing contributions.Ask your pension manager.

[It is for instance possible to pay into a SIPP which has been put into income drawdown, another method of taking benefits which means you don't have to take an annuity, just the tax free cash.]

comfortablynumb_3

Thanks Ed.
That will be useful info to have when I meet with the Pensions Manager. The meeting has actually been called by our new Company (we were taken over in Sep 06) and I assume it is to discuss changing from our current pension with our previous Company to whichever pension the new Company operates.
That should surely give me an opportunity to seek the 25% lump sum if our pension contributions are going to be transferred to another pension provider?
There will be an independent Financial Adviser at the meeting as well to answer any queries.