Unlock Tax Free Cash from your pension
Taking the tax free cash from your pension before you retire is known as unlocking your pension or pension tax free cash release. Cash can be released from both personal pensions and company pensions.
To qualify for tax free cash from your pension you should:
- Be over 55 years old.
- Have a Personal Pension or Company Pension.
- Not already be taking an income from your pension.
- Have a pension fund of at least £20,000
- Accept that this action can reduce your retirement income.
If you think pension tax free cash release could be suitable for you then you should call us Free on 0800 0842265 (or on 01604 832932) or click here to complete the Free Consultation Enquiry Form
Our entire process is kept simple, communication is conducted over the telephone and in writing by post or email.
Once we have completed a free telephone consultation we will contact your existing pension providers to obtain the technical information required to allow us to advise you on your options. With the data on your existing pensions we will be able to establish how much tax free cash you can release.
We then send you a written report outlining our recommendations and explaining the risks and any disadvantages of taking the pension tax free cash early.
If you decide to proceed we will complete the paperwork to transfer your existing pension to a suitable pension release provider, which will be one of the major pension companies. Once they receive the funds the tax free cash will be transferred directly to your bank account.
The time taken to release the cash from your pension is dependent on how quickly your existing provider processes the transfer, if everything goes smoothly, you could receive your money in as little as 4 weeks.
Releasing pension tax free cash:
You can release a tax free cash lump sum of up to 25% of the value of your pension fund. This lump sum is also referred to as the “pension commencement lump sum” (PCLS). You do not have to take the full 25% tax free cash, this is just the maximum.
The remaining fund will be invested in a SIPP (Self Invested Personal Pension) until you need it to provide a monthly income either directly from the fund or through the purchase of an annuity. The income from a pension might be taxable – depending on your circumstances.
You do not necessarily have to retire or draw an income from your pension in order to release tax free cash. If you don’t want to take the income now the remaining fund is invested until you retire. We will provide advice on suitable investment options for your remaining fund.
It is very important that you receive advice based on your personal circumstances before deciding on unlocking your tax free cash.
Are there any downsides?
If you unlock tax free cash out of your pension now, you may not have sufficient income to meet your needs in retirement. As such, Pension Release is only suitable to a limited number of people and should only be taken as a last resort. You should consider all other ways of raising money.
Releasing tax free cash from your pension can affect your entitlement to state benefits. If you are or expect to receive state benefits you should first consult the Citizens Advice Bureau www.citizensadvice.org.uk or Jobcentre Plus www.jobcentreplus.gov.uk
The Financial Services Authority (FSA) issues a “money made clear” booklet on pensions. There is no selling, no jargon, just the facts. Clicking the link below will take you to the FSA pension’s booklet. Pension release - Pension unlocking is on page 19.
How much does the advice cost?
The initial consultation is free, during this you will receive an explanation of the ways in which you can pay for the advice.
We offer a commission or fee option and our charge is usually taken from the pension transferred.