There are a few things you need to consider when taking a flexible lump sum with The People’s Pension.
When you use your pension savings for flexi-access drawdown with us:
- You can take your tax-free lump sum (normally up to 25% of your pension pot) in small chunks or in one go.
- Under HMRC rules, for every £1 you take as a tax-free lump sum, £3 will move to a flexi-access drawdown account that we’ll set up for you.
- Before you start you need to have a minimum pension pot of £10,000 (or £2,000 if you’ve already taken money from your pot with People’s Pension).
- Once the money is in your flexi-access drawdown account, you can choose to take lump sum withdrawals or set up a regular income. For a lump sum withdrawal, you must take at least £200 each time. For a regular income, you need to have £1,500 to first set this up and then you must take at least £50 per month.
- You can take one withdrawal a tax month either as a lump sum withdrawal or regular income. For example, from 6 May to 5 June – we won’t charge you for making withdrawals.
- If you’re invested in multiple funds, every time you make a withdrawal, we’ll reduce your holding in each fund proportionately.
When you use your savings for a lump sum (UFPLS) with us:
- You need to have a minimum pension pot of £10,000 when you take your first lump sum (or £2,000 if you’ve already taken money before)
- Each lump sum you take must be a minimum of £2,000 (or the rest of your savings in your pension pot if lower)
- You can only take 1 lump sum a tax month, for example from 6 May to 5 June – we don’t charge you for taking lump sums
- If you’re invested in multiple funds, every time you take a payment, we’ll reduce your holding in each fund proportionately.
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