On top of the 25% tax-free cash amount that you’ll receive, your personal tax allowance means that you can earn up to £12,500 a year without paying any tax (2019/2020 tax year).
Let’s say your only income this tax year is your £30,000 pension pot and you have the standard personal tax allowance. After you’ve taken £7,500 as tax-free cash, £12,500 from the balance of your pot (£22,500) wouldn’t be taxed. This leaves £10,000 left to be taxed at your normal 20% rate – so you’d pay £2,000 in tax.
If you were earning any other income, any taxable money would be added to your other income for that year and taxed at your relevant income tax band. This could take you into a higher tax band of 40%. For example if you earn £25,000 a year (20% income tax rate) and you then receive £25,000 taxable amount from your pension pot. This would make your total income for the year £50,000 and would push a proportion of your income into the higher tax bracket of 40%.