I was going to claim a small pot lump sum but the fund value has just gone over £10,000. What can I do?


Under the rules, a small pot lump sum must be under £10,000 or less. You could possibly wait to see if your pension pot falls below £10,000 due to investment performance to claim a small pot lump sum, or you could claim a flexible lump sum (HM Revenue & Customs refer to this as an uncrystallised fund pension lump sum or UFPLS). The UFPLS claim pack will make you aware of the difference between this and a small pot lump sum eg a UFPLS will reduce your annual allowance to £4,000 (known as the money purchase annual allowance), whilst taking a small pot lump sum will maintain your £40,000 annual allowance.

Remember that if you take a UFPLS, each withdrawal must be £2,000 or more and at least £10,000 must remain in your pension pot.


Was this article helpful?

Please score it so we can improve and offer you more

 Members 1 person found this helpful