What is pension release?

New Rules – Pension Freedom

Pension benefits can be released from age 55 onwards.  New ‘Pension Freedom’ rules introduced in April 2015 allow you to withdraw up to 100% of your pension benefits as a cash lump sum, income or a combination of both.


Pension companies do not give advice and will not tell you how to save income tax if you deal directly with your pension provider.  The will leave you to sort out your tax liability later on.  Many people are getting some nasty surprises from the not friendly Tax Man.  The latest rules allow you to take the first 25% of your fund completely tax free.  Any amount over 25% will be added to you income and taxed at your marginal rate of tax.  You could be facing paying tax at 40%!  Albion Pensions could help you to avoid this, if you are not already a higher rate tax payer, and get the maximum payments from your pension funds.  CLICK HERE to find out how much tax you could end up paying.

Financial Advice

If you have a Personal Pension it should be quite simple to release the cash from your pension.  Your provider should be able to process the payments but many will want to see proof that you have taken the relevant advice before they do.  The government has set up a service called Pension Wise to help but it will only give general guidance, not advice.  Many pension providers will not accept this as being sufficient advice.  Albion Pensions provide quality professional advice in connection with all UK pension funds.

Company Schemes – Final Salary Schemes

if you have accumulated pension benefits in a Company or Final Salary Pension Scheme you may find it difficult to release cash before the official or normal retirement age.  The new Pension Freedom rules do not apply to Company or Final Salary Pension Schemes and you cannot therefore take the benefits from these schemes under these new rules.  It is possible to transfer these benefits to a different type of pension plan that will allow you to enjoy Pension Freedom, however you must receive authorised and regulated advice before doing so.  Albion Pensions deal with all UK pension schemes, that are eligible for transfer, and will advise you on the suitability of accessing these benefits through Pension Freedom.  We will also tell you how to pay as little tax as possible so that you get more cash in your pocket.

Warning – if it sounds to good to be true, it probably is.

UK pension scheme rules are extremely complex so it will always be in your best interest to take expert advice from a professional adviser.  Albion Pensions only deal with UK pension schemes and only use HMRC approved pensions and work within HMRC tax legislation.  We do not use any offshore schemes or foreign tax rules.  If anyone tells you is it possible to get more than 25% tax free it will be illegal and could result in serious financial loss.  It is only possible to get cash from your pension before the age of 55 in extremely limited circumstances.  Accessing your pension before the age of 55 could result in serious financial loss.  Read our ARE YOU UNDER 55? section for more information.