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Rakhi Vasavada
Rakhi Vasavada, Financial Advisor
Category: Law
Satisfied Customers: 4545
Experience:  Attorney and Financial Expert. Have specialization in Financial Laws.Practice experience of over 13 years
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I have a small pension annuity taken 3 years ago at approx.

Customer Question

I have a small pension annuity taken 3 years ago at approx. 55 years old which after tax pays about £ 1600 annually. Can I take a one off lump sum settlement payment with the new government legislation.
Submitted: 2 years ago.
Category: Law
Expert:  Rakhi Vasavada replied 2 years ago.
Dear Friend,

Hello and welcome. Thank you for providing an opportunity to assist you.

Changes introduced from April 2015 give you freedom over how you can use your pension pot(s) if you’re 55 or over and have a pension based on how much has been paid into your pot (a defined contribution scheme).

Having said this, YES, you CAN take one off lumpsum payment but even with the new legislations, you will have some tax implications. You could close your pension pot and take the whole amount as cash in one go if you wish. The first 25% (quarter) will be tax-free and the rest will be taxed at your highest tax rate – by adding it to the rest of your income.

I am sure this would help.

I wish you good luck. You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.

Warm Regards,

Expert:  Rakhi Vasavada replied 2 years ago.
I hope the above answer helped you. Warm Regards,