Pension commencement lump sum (PCLS)

When you access your pension savings and start drawing an income, such as with an annuity or via flexi-access drawdown, you can often take some of your savings tax free. This lump sum is normally up to 25% of your pension pot and is also known as tax-free cash.

(And if you had an entitlement to more than 25% as of 5 April 2006, this might still be the case now.)