Lump sum

A one off single payment. Under current rules, you can withdraw 25% of your pension fund as a lump sum, tax-free. From April 2015, when you retire, you can withdraw some or all of your accumulated pension fund as a lump sum. The first 25% will remain tax-free, and the remaining 75% would be charged at your highest income tax rate.

See also: Annuity, Small and stranded pension pots, Trivial commutation, Pension Tracing Service

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