Savers will be able to access the entirety of their pension at any time after age 55, subject to income tax at marginal rates on three-quarters of the money.
The ability to take the whole pension as one lump of income would mean someone with a £100,000 pension could take £25,000 tax-free and then withdraw the remaining £75,000 to spend or invest as they saw fit.
The £75,000 would be treated as income for that tax year, pushing the individual into the higher-rate tax band for the year.
I hope this is helpful and answers your question.
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After March 27th this year, if I take unto £35k, is this subject to tax?
Thank you for your reply.First 25% of the pension pot will be tax free... there is no change to that. If £35k represents no more than 25% of your pension pot then this amount will be free of income tax.
From March 27, the Government will introduce arrangements to give savers greater access to their pensions.
Savers whose total pension savings amount to £30,000 – rather than £18,000 – will be able to take the entirety as cash (“trivial commutation”). This will be taxed at marginal rates.
Savers with larger amounts in pension savings will be able to take up to three pensions worth £10,000 each as cash.I hope this is helpful and answers your question.